Ansteel's Karara iron ore mine in Australia to cut 70 jobs

SYDNEY, March 19 (Reuters) - The Karara iron ore mine in Australia will cut 70 jobs this week, or 15 percent of its workforce, as it struggles with falling prices of the raw material, a mine spokesman said.

Karara is a joint venture between Gindalbie Metals and Chinese steel maker Ansteel.

Spot iron ore prices have dropped to their lowest on record amid a mounting supply glut that, according to analysts, is likely to worsen over the year.

Analysts blame a massive rise in production on overestimates of China's appetite for imported ore by sector titans Vale of Brazil and Australians Rio Tinto and BHP Billiton (NYSE: BBL - news) . This has left smaller rivals struggling to survive.

"These changes deliver cost reductions at a time of depressed iron ore prices," a spokesman for the Karara mine said, referring to the job cuts.

Ansteel owns 52.16 percent of the mine, which shipped 2.51 million tonnes of iron ore in the last quarter, according to company data. Gindalbie owns the remaining 47.84 percent.

Miner Fortescue Metals Group Ltd this week pulled a $2.5 billion high-yield bond issue after investors rattled by tumbling ore prices balked at the offer. (Reporting by James Regan; Editing by Himani Sarkar)