* Atlas Iron to suspend all mining this month
* Blames low iron ore price
* Says extensive cost cutting not enough
* More Australia miners under threat as supply glut swells (Adds quotes, details)
By James Regan
SYDNEY, April 10 (Reuters) - Australia’s Atlas Iron Ltd said on Friday it will progressively suspend mining this month due to low iron ore prices, the latest casualty in a strategy by larger producers to flood the sea-traded market into China.
Atlas, which is scheduled to ship the majority of its projected 13 million tonnes of iron ore this year to China, said exports will cease shortly after mining is halted.
“Despite an extensive cost-cutting program... the global supply-demand imbalance for iron ore has driven prices down to the point where it is no longer viable for Atlas to continue production,” Atlas Managing Director Ken Brinsden said in a statement.
Iron ore is veering to a new crisis as prices for future delivery of the commodity slide 30 percent in a month, and its outlook is now more bearish than oil.
Spot iron ore prices < .IO62-CNI=SI> are down 60 percent in last year.
Analysts blame a massive rise in production on overestimates of China’s appetite for imported ore by sector titans Vale , Rio Tinto and BHP Billiton
Together with Australia’s Fortescue Metals, these companies added 234 million tonnes of iron ore in the past two years - five times yearly U.S. consumption - and intend to inject another 196 million tonnes by 2020.
Their strategy is to eliminate competition, even it means driving down the price to the break-even point.
Atlas is one of several lower production miners locked in a fight for survival and attempting cut costs.
Others under threat because their costs are too high include BC Iron Ltd, Fortescue, Arrium Ltd and Grange Resources Ltd, according to cost calculations by UBS.
“Overall it’s more a question of time until we see more of the high-cost juniors throwing in the towel because it’s just not economical for them anymore,” said Carsten Menke, commodity analyst at Bank Julius Baer & Co Ltd in Zurich.
There was market speculation this week over whether bondholders in the United States, Atlas’ secured creditors, would push to place the miner in receivership, given it holds A$327 million ($251.36 million) in gross debt.
The decision to suspend production was taken after extensive consideration of the company’s financial position, discussions with contractors and secured creditors, Brinsden said.
“They would have had to go to all of their service providers to see if they could make this venture profitable and came up dry,” said Paul Phillips, senior equities analyst at Perennial Growth Management.
Australia’s Cairn Hill iron ore mine was shut last year by its owner IMX Resources after falling prices crippled the 1.7-million-tonnes-per-year operation. ($1 = 1.3009 Australian dollars) (Additional reporting by Sonali Paul in MELBOURNE and Manolo Serapio Jr. in SINGAPORE; Editing by Ed Davies)