Download: Fast, Fun, Awesome
study in australia
student information in australia
Australian University graduate information
professional networking for australian university students
employment links for australian university students
University quizzes for australian students

Mining projects may not be viable

According to research from Murdoch University’s Asia Research Centre, iron ore prices could drop dramatically by 2015, making planned projects in Australia potentially unviable.

Dr Jeffrey Wilson said this drop was a result of Chinese resource security strategies aimed at ending a pattern of soaring iron ore price which began in 2005.

“From 2001 to 2011, iron ore prices increased nine-fold. After a 71 per cent spike in price in 2005, the Chinese government undertook two strategies: aggressive investment in new entrants to the Asian iron ore market, and the creation of a Chinese importers’ cartel to improve their bargaining power with the Big-3 miners – BHP, Rio Tinto and Vale,” Dr Wilson said.

“While cartelisation has been effectively nullified by the Big-3 demanding a move to a quarterly pricing system following the Stern Hu Affair, the effects of Chinese investment in new iron ore suppliers are about to come into play.”

Collectively, 30 new Chinese-sponsored iron ore juniors plan to add 425 million tonnes per annum (mtpa) of iron ore to the regional market over the next three to five years. Meanwhile, the Big-3 are ramping up their production by 450 mtpa for 2015.

Dr Wilson said he expected this convergence to break the longstanding pattern of extremely tight supply, leading to an iron ore price drop that would make many planned West Australian projects unviable.

“In comparison to the Big-3, many of the new Chinese-backed entrants to the WA iron ore sector are quite small, such as Mt Gibson and Aquila. In the scale-reliant iron ore industry, it is unlikely that these firms will be to compete with the Big-3 under conditions of price competition,” Dr Wilson said.

“If iron ore prices do begin to fall rapidly, the recent shelving of Sinosteel Midwest project may only be the tip of the iceberg in terms of iron ore cancellations in our state.”

Dr Wilson’s paper ‘Chinese resource security policies and the restructuring of the Asia-Pacific iron ore market’ is forthcoming in the leading industry journal Resources Policy.

Leave a reply

Feature Research
Controlling fear by modifying DNA

For many people, fear of flying or of spiders skittering across the lounge room floor is more than just a [more]

Kidney disease gene controls cancer highway

University of Queensland researchers have discovered that a gene that causes kidney disease also controls growth of the lymphatic system, [more]

Queensland fraud is a billion dollar business

Queensland businesses could be losing over $12 billion per annum as a result of company fraud according to a recent study [more]

Inside the mind of a burglar

Burglars are opportunistic, generally choose their targets at random and know all the tricks householders try to use as deterrents, [more]

Flight experiment goes boldly forth to advance new technology

A hypersonic flight experiment at eight times the speed of sound, led by a University of Queensland PhD student, has [more]

Pre-drinking alcohol before hitting the nightclubs likely to lead to violence

The increasingly common practice of drinking at home before hitting the nightclubs is the major predictor of people experiencing harm [more]

Research reveals women are more interested in a man’s earning capacity than the size of his wallet

Despite ABBA’s insistence that women long for “money, money, money”, research has found that The Beatles were on the [more]

Challenges still face women seeking seniority in business

Research conducted by the UTS Centre for Corporate Governance underpinning the 2012 Australian Census of Women in Leadership reveals a decade [more]

Swiss Army Knife teeth secret to seal’s success

Biologists have shown how an advanced set of teeth give Antarctic leopard seals the biological tools to feast on prey [more]

Beautiful physics: Tying knots in light

New research published today seeks to push the discovery that light can be tied in knots to the next level. [more]