Atlas Iron will suspend mining operations at its Pilbara mine sites in the next few weeks citing a significant drop in the price of iron ore.
Further, the company said that following the suspension of operations at all of its mines it will stop exports.
According to Atlas Iron, the global supply-demand imbalance for iron ore has driven prices down, forcing the company to discontinue production.
Atlas has continually cut costs and its current break-even price on a benchmark 62Fe basis is below $60 a tonne at earnings before interest, taxes, depreciation and amortisation (EBITDA) level; however, Atlas’ break-even price remains well above the current spot price, despite substantial reductions.
In this regard, Atlas plans to halt mining and crushing at its Mt Webber project next week and cease activities at the Abydos project within 14 days.
Operations at Wodgina mine are expected to cease in late April.
Pending future iron ore market conditions, all Atlas projects will be put on care and maintenance.
Atlas Iron managing director Ken Brinsden said: "To suspend our operations, with the impact that will have on so many committed and talented people, is an extremely difficult decision."
The company, which currently employs about 500 people across its production assets and 75 people in its Perth office, is holding discussions with its creditors concerning options that would enable the mines to re-start.
Atlas expects prices to increase based on the percentage of global iron ore production, which is cashflow negative at present.