China recently stated its intention to assist Brazil iron ore giant Vale invest in ships that can transport high-quality ore from Brazil to North Asia. The deal will see China invest up to $US4 billion and is expected to lead to further weakening of the iron ore price, putting greater pressure on struggling Fortescue Metals Group.

Currently, Andrew Forrest's company is the world's fourth lowest cost exporter of iron ore. Vale, on the other hand, produces some of the lowest cost iron ore globally. Historically, freight has made made Vale's ore relatively expensive compared to BHP and Rio's product. It remains to be seen if Vale's gain will result in Australia's loss.

The article below provides full commentary about China's investment in Vale's iron ore expansion.

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