Worlds largest Iron Ore consumer looking for alternatives to Australia

Not long ago we brought up the fact that China and Australia are having a bit of a spat on the trade front. It seems like things are hotting up some more. China is looking for alternative sources to Iron Ore. This article talks about China seeking potential sources in Africa. It won’t be China’s first foray into Africa, and I suspect it is not going to be the last either.

Taking a mine from exploration, to development, to production takes many many years. For mines to have a resource estimate and an economic assessment means they have had substantial amounts of work done on them. It takes 10-20 years on average to get a mine into production.

When ones sees news like this, they need to think about the possibility of investing in the right place. I can only conclude that a near-producing mine is a very opportune investment. Black Iron Inc (TSX:BKI) was covered very recently, and if you haven’t read the report, you should take some time out and do so now. Failure to do so will mean you know less than your peers, and you’ve left money on the table. It is one of the few stocks that is on the precipice of production, has ultra-high grade Iron Ore content (68% vs 62% standard, and sub 60% that gets purchased often), and is worth over $3 but is trading at $0.10.

I anticipate this trade “discrepancy” to continue, particularly given that China is the world’s largest consumer of Iron Ore.