Live IO Prices, page-21

Iron Ore is a commodity. You need to read some basic microeconomic theory on marginal cost (and the marginal cost curve of production) to understand the industry structure and why, in response to the huge jump in demand for iron ore from China (and India) over the past twenty years, the low cost miners like BHP and Rio HAD to invest in a massive ramp up in production to flatten out their cost curve.

In a commodity market, in the absence of collusion, price equals marginal cost of production.

In the long run BHP and Rio, as the world's lowest cost producers, are maximising their profits from their massive investment in increased production and minimising their cost base and keeping at the bottom of the industry marginal cost curve even though this will result in a lower price and even lower margins.

It is an excellent example of pure classical microeconomic theory.