Champion Iron (ASX:CIA) produced direct reduction quality iron ore from its direct reduction pellet feed project at the Bloom Lake mine in Canada, according to a Monday filing with the Australian bourse.

A maiden commercial sale of a Capesize vessel, containing at least 160,000 wet metric tonnes, is anticipated in the third quarter, the filing said.

The project is expected to increase in capacity gradually to achieve full commercial production toward the end of the current financial year, per the filing.

Shares rose 2% in morning trade on Monday.