Iron ore price, page-4271

I am trying to understand what has caused FMG price to be near their 52 week low whilst Rio, BHP at 52 week high.

The current sentiment to FMG share price seems to largely driven by the discount FMG receives for its Iron Ore relative to BHP, RIO etc. due to the pollution restrictions being placed in China until March.

Whilst this seems to be negative for IO industry and in particular FMG, wouldn't it be a much bigger issue if China wanted to restrict the use of steel in China? My point being that if China limit their production of steel in China for a period, presumably they will need to import steel for their consumption purposes (buildings, cars, infrastructure etc.). If China's demand for steel remains unchanged (which you would expect is the case given their economy is still growing at a healthy rate), then you would expect that if China aren't producing as much steel, then this steel will need to be made elsewhere and imported into China. And these other countries will still need to buy iron ore to make the steel. FMG has already announced they are looking at selling to other countries e.g. Germany etc. Perhaps there is additional transport costs for markets further abroad than China, but you could argue this may improve FMG risk profile if it is not totally dependent on selling to China.

And as has recently pointed out by interview with Peter Switzer, there are 4 positive drivers towards IO price at the moment - China, USA, India and Europe all growing strongly which will no doubt increase demand for IO, and it is very unusual for all 4 to be firing at the same time.