The rise of nanometers

Australia.

Western Australia.

About 1,200 kilometers north of Perth, the capital of Western Australia, a small town called Newman is the most desolate area in Australia.

There are scattered drought-tolerant plants in the desert and Gobi Desert, and the Tropic of Capricorn just passes by the town of Newman.

In July, it is winter in the southern region.

The dry inland and strong ultraviolet rays make people feel warm and comfortable, but this year's southern hemisphere winter seems particularly chilling.

In the only bar in the town, three or five drunk white people drank beer and complained about the increasingly bad economy.

A middle-aged man with an unshaven beard drank a glass of dark beer in one gulp: "Hiccup... damn Chinese guy, just like the toilet at Stephen's house, stinky and disgusting."

"Fake squid..."

Another middle-aged man smoking a cheap cigar showed his big yellow teeth: "FMG's Christmas Bay stopped production last week and laid off more than 500 people, damn it!"

FMG was previously the fourth largest iron ore producer in the world and is currently the seventh largest iron ore producer in the world.

Suddenly the wooden door of the bar was pushed open, and a bald man with blurred eyes broke in.

The bearded man was stunned, then mocked: "Oh? Isn't this Mali? Didn't you go to Tokyo? Did those little dwarfs find some gypsy girls for you?"

Bald Mali pulled up the high stool beside him and said in a numb tone: "A glass of Supernova."

The bartender turned around, took down a bottle of high-strength vodka and a bottle of tequila from the wine cabinet, and mixed them in a dazzling way.

The bald Mali, who was usually talkative, was like an autistic child, looking at the wine cabinet with dull eyes, as if there was some fatal temptation among the colorful wine bottles.

The bearded man, Dahuangya and others continued to sarcastically vent their inner depression and dissatisfaction.

This has something to do with Mari's work. He is an employee of the Australian branch of Mitsui-Itochu Iron and Steel Co., Ltd. and is responsible for the translation of commercial contracts.

The Whaleback Mountain Iron Mine in Newman Town is an iron ore jointly developed by BHP Billiton and Mitsui-Itochu Iron.

The quality of the iron ore in this mining area is very good. After preliminary selection, the grade can be as high as 63%, and the annual output is about 100 million tons.

The bartender pushed a cocktail called Supernova in front of Mali.

Mari picked up the drink and drank it in one gulp. After the cold wine entered his throat, it was like a supernova exploding in his body.

"Oh... Mari, since when did you become such a man?"

"Haha, it must be the Japanese woman who restored his confidence."

After swallowing a whole glass of cocktail, Mali's face turned red, like an enraged lion, but his bald head made his expression look ferocious and strange.

"You sons of bitches will just bark like wild dogs here. Shut your mouths like canned herrings, or I will kill you with one shot."

After saying that, he took out a revolver and smashed it on the counter, staring at the bearded man and Big Yellow Teeth with bloodshot eyes.

Gulu! The bearded man swallowed involuntarily, and the obedient and honest man exploded. That was terrifying.

Suddenly Mari burst out laughing: "Haha... just wait here to die! BHP Billiton has planned to close the Newman mining area. You can drink more while you can still drink."

"What……"

"Fake Squid, Mari, what did you say?"

Upon hearing the news, all the miners were shocked.

Previously, they were very worried about the future of the Newman mining area, especially in the past two months, the Australian iron ore industry has suffered an unimaginable economic winter.

FMG closed the Christmas Bay mining area in the center of Chichester and the King mining area in the Solomon center; in May, Rio Tinto announced that the annual output of the Hammersley iron ore would be reduced from 180 million tons to 15 million tons.

The production volume of BHP Billiton's Yangdi mining area has also dropped from 80 million tons per year to less than 7 million tons.

The Newman Mining Area has actually reduced production and has only opened less than 15% of its production capacity. Now it is going to close the mining area.

"Mali, didn't you say that Nippon Steel and the others still maintain orders?"

Mari rubbed his face blankly, his voice slightly hoarse: "Nippon Steel has stopped orders for next year, and Posco and Arcelor are also considering suspending iron ore imports next year."

"Oh my God!"

"They're crazy."

If Nippon Steel's suspension of imports is not fatal enough, then Arcelor, the world's largest steel company, has also suspended the import of iron ore, which is a critical blow to the three major iron ore suppliers.

Arcelor Group is the leader in the steel field of the Xizhou Alliance. It produces 130 million tons of steel every year, accounting for about 10% of the total global steel production.

For the three major iron ore suppliers, it is a crucial customer, especially after the complete defeat of the Chinese market. Arcelor, Posco, Nippon Steel and JFE Steel are their last basic bases. .

"They are not crazy, but they have no choice." After Mari finished speaking, he drank half a glass of cocktail:

"China Iron and Steel Alliance, this year's steel smelting costs have dropped to 42% of the previous level, and the steel quality is world-class. Arcelor's situation is also very bad."

As Mali said, without purchasing ore powder from Blue Star, United and Beijing Enterprises, Arcelor, Posco and Nippon Steel will have no way to compete with the China Iron and Steel Alliance.

If purchasing, BHP Billiton and others must be abandoned.

In this dilemma, forced by the sharp decline in its own stock price and profits, Arcelor gradually tilted towards this side of Blue Star Mining.

Capitalists who want to make money will naturally not have the international spirit to sacrifice themselves for others. The suspension of imports of Australian iron ore is basically a foregone conclusion.

Perhaps many people think that since the iron ore cannot be sold, they should simply stop mining it, so that they will not lose money.

In fact, the situation is not that simple. After large mining companies acquire mines, they also need to build mining areas, equip mining equipment, selection and sintering equipment, railways and transportation vehicles, as well as high labor costs in developed countries.

Closing the mining area is fine for a short period of time, but if it goes too long, the depreciation or even scrapping of the equipment will be astronomical.

What's more, due to the subprime mortgage crisis in 2008 and the recent Xizhou debt crisis, the debt ratio of the three major iron ore suppliers is as high as 62 to 73%.

Among them, BHP Billiton, the most serious company, currently has liabilities as high as 48.2 billion yuan, accounting for 72.2% of total assets.

With such a terrible debt ratio, if there had not been a blow from Blue Star Mining and the Chinese market was in hand, it might have been possible to revive the company.

The problem is that the global iron ore price is collapsing now, and every ton produced will result in a loss of 17 million yuan. Even if Western capital giants provide assistance, they cannot withstand such a terrible loss.

Faced with such a severe situation, they reduced production capacity, closed mining areas, and laid off a large number of employees; at the same time, they went to the Dalian Exchange, hoping to restart negotiations with Blue Star Mining.

Inside the Miner's Pub in Newman Town.

Mali and a group of miners were drunk. For Western Australia, which has a single economic structure, the deterioration of the ore trade may directly hit the region's economy.

The next morning, the heads of BHP Billiton and Mitsui-Itochu Iron announced that the Newman mining area would cease production and close down. Thousands of miners in the entire mining area were laid off, and more than 95% of the workers were laid off.

There was chaos and loss of control at the scene, and many miners directly smashed mining equipment.

As soon as the news came out, BHP Billiton's share price plummeted again.

The three major iron ore suppliers are really on the verge of collapse.