The bottom line, page-4

that"s all relative with the certain impending dollar decline,as the other big players get the same advantage anyway.what it means is this,the actual sp goes up from the aus $ decline,but the discounting from the big operators will be ramped up,as there is only a certain amount of demand available anyway.they can actually afford this cycle and still remain very profitable.with fmg"s woes,they will have a few extra dollars from falling the aus $,but will have the unenviable task of trying to discount down to the big boys level,with the usual implications about the quality of ore grade and the fact that everything has to go just right,otherwise no "big"investor or fund manager will have a bar of them-debt problems,etc.
yes,then i hear you say that the futures are way up,and china,not to mention india and even the new mega steel mill in asia all point to a rosy future.if that were the case,why would the focus be on production,rather than exploratory.the answer is that the only way for anyone in the industry to survive,is to try and cut costs by ramping up production as the demand is at best slightly askew of the bottom side of stable.that's exactly why fmg are not an investment as such,but just a short term money making venture by the shorting brigade.
cheers crazypunter