Who will be the first to benefit when ore turns, page-19

Interesting banter, enjoyed it! It's a case study for Resource Economics lectures in years to come isn't it? The demand shock (China) -> big profits -> big investment and firm entry -> supply shock -> prices fall. In some ways it's perfectly rational but there's blood on the streets now. RIO/BHP may be at the bottom of the cost curve, but they were selling for $130/ton at start of the year (say $90/ton margin) at $70/ton make that a margin of $30 (maybe $35 with the much vaunted 25% cost reduction lol). Margins have been owned, 90 to 35, would have to sell triple the product to keep profits constant.... ummm no!