China determined to build African iron ore “Pilbara killer”

It is not often that you get to name the pain of a nation. But that dubious privilege fell to me a few years ago when I christened the Simandou iron ore project the “Pilbara killer”. That killer is in the news at Nikkei:

  • China has learned the lesson of Japan pre-WWII which suffered from resource supply chain concentration risks.
  • As Australia increasingly integrates with the democratic “Quad” iron ore diversification is becoming increasingly pressing for China.
  • China is aiming to get the Simandou operational by 2025, says Peter O’Connor at Shaw and Partners.
  • China could announce progress ahead of the Forum on China-Africa Cooperation later this year.
  • Guinean President Alpha Conde is already showing signs of developing into a dictatorial Chinese puppet after last year changing the rules to allow a third term.

The unstable politics of Guinea is probably the largest risk to the project. It is riven by the ethnic politics typical of the unstable African nations.

But if it can get underway, then the scale of investment is so vast that it has the scope to settle social unrest through economic development. It is a relatively small population at 13m.

Long-term observers will still be skeptical that China can get this done. It has failed on multiple occasions before, retarded by complex politics and immense cost.

In my view, the base case is that it does get built this time. The incentive for China is huge given its Australian problems. Cost is less of an object when investments take on a shade of khaki green. We can see analogous investment today in the US with semi-conductors capacity as Intel, Samsung and TSMC as all prepare for the possibility of Taiwan blockades or war.

That said, Guinean iron ore will still have to pass through SE Asian choke points to reach China so it doesn’t fully resolve supply chain issues if things turn serious.

The US First Fleet is sailing gaily around the Indo-Pacific for a very good reason.

David Llewellyn-Smith
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  1. Pilbara Killer
    Qu’est-ce que c’est
    Fa-fa-fa-fa-fa-fa-fa-fa-fa-far better
    Run, run, run, run, run, run, run away oh, oh, oh, oh
    Yeah, yeah, yeah, yeah!

    • Great! When a war breaks out, they can protect men, and innocent children. When a ship sinks, save men and innocent children first.

      Can’t wait for the matriarchy to usurp the patriarchy.

  2. “The US First Fleet is sailing gaily around the Indo-Pacific for a very good reason”

    Yep, to pick up the fight.
    Imagine China parading in the gulf of Mexico navigating to say West Indies or Cuba.
    LOL, “democratic” quad.

    • Even StevenMEMBER

      Pretty sure the Chinese navy docked into Sydney not that long ago. Not sure it would be welcome now.

      Your accusations of double standards are without merit.

      • Your accusations of double standards are without merit

        Chinese ships were, wait for it, **invited** to sail AUS waters. A subtle difference. You know, ships were not in Sydney to *project* the power.

        LOL, “accusations”, “without merit”
        C’mon, I dare you say that with a straight face

        • Nah mate, those two Chinese submarines showing up unannounced.

          The state gov was horrified and the fed gov had to hide behind “Ahhh ahhh, yeah we knew they were coming and forgot to tell you. Oops, sorry about that” or they would have created an international fight they didn’t want to start.

          • “Nah mate, those two Chinese submarines showing up unannounced.”

            How do you know they came unannounced?
            Experts on the subject embedded with media said that it was announced and said the same.
            When you buy tin foil at supermarkets, are you making little hats from them?

          • Djenka

            quote “Two Chinese warships entered Sydney Harbour last week in a visit that even surprised NSW Premier Gladys Berejiklian.

            It sparked public outrage that the ships were allowed to moor on the eve of the 30th anniversary of the Tiananmen Square massacre.” unquote.

            There is also info from the ABC and other news outlets on the story from 2019.

            Would you like a tinfoil hat? It would look quite jaunty on you. I could put a D on it while you sit in the corner.

          • Bubbley,

            English is presumably your first lingo. Do you need a non-native speaker to translate the article to you?
            It clearly says that Chinese warships have seeked and were given a permission to enter the Sydney Harbour.
            LOL, I bet you read only the title of the article that starts on Chinese vessels but after 3 sentences becomes sumtin unrelated for the next 203 sentences

            Prime Minister Scott Morrison said the arrival of the warships in Sydney had been planned for some time.
            Chinese Navy personnel are seen onboard a Chinese Navel ship after it arrives at Garden Island Naval Base in Sydney.
            He said it was a “reciprocal visit” as Australian naval vessels had visited China.

            It may have been a surprise to others but it certainly wasn’t a surprise to the Government,” he said.

            “[The Chinese vessels] were returning from counter-drug-trafficking operations in the Middle East and that is a further demonstration of the relationship we have.”

            US warships navigated area to project power. Chinese warships got permission to moor 2 ships for tourism

        • I know our msm is rubbish but You need to stop watching to much rt cgtn.
          Btw what’s your anti US Western obsessions?
          Is it a Serb thing?

          • Why would a critic thought be associated to having a XYZ-thing?
            Oh, I know… …because your world is divided to “us” and “them bogeymen whom are always searching for ways to undermine democratic [ROFL] world”

            Nah mate, I am avid critic of anything not right (inclusive of China), it is just that DLS-FOR-PRESIDENT’s frothing at mouth each time China is mentioned that provides a never-depleting source of fun (which was obviously misconstrued as “obsession”)

        • Djenka – you know, I was going to write a long reply but realised there was no point. You aren’t interested in discussion.

          I run a business and don’t have the time or energy to waste on a CCP shill who floods the comments without bothering to subscribe.

          • We don’t see them much here given the content, but I have a suspicion he, she it is a troll and they shouldn’t be fed.

    • Navy can sail around lots, but China is fighting a grey war eg using the fake fishing boats manned with PLA soldiers, fishing boats that never follow a fishing boats normal pattern, they just sail to places like Mischief reef and block other nations from fishing there. Then when the QUAD or Philistines navy etc try to block them CCP will claim foreign aggression. QUAD is being out manoeuvred.

      One difference to the Chinese sailing around the Gulf would be that most ASEAN countries are very happy to have the US & QUAD in SCS

    • China has the largest Navy in the world by number of ships, and at this very moment they’re intimidating Philippines.

      You clearly either have no idea what you’re talking about or you’re a Chinese troll….

  3. Truly an unenviable choice
    Deal with West Africa or put up with Australia
    Come back Brazil, we’re sorry about the Dam and the Politics and damn Covid
    we’re truly sorry just get the mines restarted and we’ll all Vale the sunset together.
    Pinky Promise

    • True, though with the politics, religious & tribal tensions there they may not even need to

    • @ Ronin

      That era has finished when Rambo and Chuck Norris went to retirement.
      It is still possible but not “easy”.
      Also, Guinea could be also “____/gambit”. Chinese play a long game in everything, layered.

  4. I would not be surprised if they are also looking north to Mongolia and Siberia for the very reason that shipping routes can easily be disrupted as you pointed out. Multiple train lines far inland would be much harder to disrupt. A few years back they did find a massive deposit in western Siberia but not sure what’s happening with that.

  5. Arlec Montassino

    China is not thinking strategically enough. They should just buy huge sections of Africa wholesale and annex the land into China.

    Offer the locals work permits, but not the right to marry Chinese workers or citizenship, which will be reserved for the Han and European experts. As part of the deal, clear out huge sections of the territory of the original inhabitants.

    Eventually, China can just replicate itself inside Africa and exposure to long shipping routes is less of a problem.

    But I guess China has never had this exploratory and colonizing spirit. Its why they failed whilst Europeans succeeded. China has all the resources to be mining and colonising the solar system right now, but will wait until the West clears the way.

    • Ronin8317MEMBER

      The Chinese import all their workers for their project in Africa. Colonization however will be difficult because none of the Chinese workers want to stay in Africa. This is one of the main reason why all the projects are finished ahead of schedule.

      • Yep nothing has changed West Africa is West Africa
        Being Australian I can accept that most thing you encounter are FUBAR, it’s just the way it is but Africa takes it all to another level.
        The Chinese that I know just can’t understand this, they begin to think it somehow about them when in reality it’s just Africa. They want out of there because they know that wallowing in this sort of s#it leaves a stain that no amount of showering will ever remove.
        It’s strange to realize that today’s young ambitious Chinese are scared of dysfunction.

  6. China has an option to sail the ore around South America through the pacific to China or take the shorter route around South Africa straight to Pakistan and train into China. No need to go via South East Asia.