IO chart shows its Bottomed, page-10

Down 40cents, it's stabilised at around $95, with Chinese steel inventories at a low I'd expect the price to consolidate and possibly move up closer to $100.

Fourth quarter production report now only a couple of weeks away, what's interesting however is that none of the analysts have factored in a reduction of C1 costs based on a massive 35% increase in production. I'd expect C1 costs to reduce by around 20% to $28 from $34 last quarter, this is not unrealistic based on the fact fixed costs remain the same despite the production increase.

FMG continues to move down the cost curve, and with their own ships next year I believe their total production costs will be lower than BHP and RIO in the next year or so considering freight costs are anywhere between $10 and $15 per ton. If they can lower these to around $5 per ton by using their own ships they will be one of the lowest cost producers in the world. By way of example Vale pays as much as $25 per ton in shipping costs to China from Brazil.