Pilbara miner Atlas Iron says the iron ore price would need to fall significantly before it affects the company’s profitability.
Chairman David Flanagan said recent analyst notes on Atlas showing break even costs of US$75-80 per tonne were “about right”.
“Given where the price is now we’re making money and there’s plenty more pain that we can sustain before it’s anything like an injury that would take us off the field,” Mr Flanagan told an iron ore conference.
The price of the steel making ingredient is trading around US$105 per tonne, following a recent steep decline.
Some analysts are predicting it will fall to US$80 per tonne.
Two weeks ago Atlas said it was confident the iron ore price would trade around $US120 per tonne over the next half year.
Mr Flanagan said fluctuations in the price of the commodity made iron ore mining a “contact sport”.
“It’s not tennis,” he said.
“Sometimes it hurts a bit. As the price moves around you feel it in the stomach but that doesn’t mean you take your eye off the ball.”
Atlas made a net profit of $73.7 million in the first half of the 2013/14 financial year.
The company increased its full year production guidance to between 10.2 million and 10.7 million tonnes after shipping a record 5.1 million tonnes during the first half.
Atlas’s long term aim is to ship up to 46 million tonnes per annum.