Australian miner Atlas Iron was hit by rising metallurgical coal costs in its first quarter ended September, according to its latest production report Wednesday.
Atlas received an average price of $45/dry mt in Q1, stable on its sales price in the preceding three months, despite Platts 62% Fe IODEX moving from a $55.71/dmt CFR average to $58.55/mt CFR over the same period.
The company said it had to give increased discounts in the quarter, after a "significant increase in coal prices over recent months, with steel mills preferring higher grade ores, which require less coal."
Atlas sold 2.3 million wet mt of Standard Fines, 400,000 wmt Value Fines and 1.4 million wmt of Atlas Lump in the September quarter, with total production of 4.1 million wmt up 8% from 3.7 million in the preceding quarter.
It attributed higher sales to increased production from its Mt Webber mine, but said this also increased costs to A$50/wmt ($38) from A$49/wmt in the June quarter -- Mt Webber is further from export facilities, which nudged costs higher.
