The second risk is China's decreasing steel consumption.
The last five years saw China's big ambition to develop its infrastructure and mass market condos for its people and hence steel consumption went through the roof, resulting in the bull market in steel and shipping (of iron ore to make steel). That party is now probably going into its 11th hour and Cinderella is ready to drop her glass shoe.
China needs to shift its economy from manufacturing to services, which would need less steel and hence less iron ore. Not to mention that after getting squeezed by the Australian and Brazilian iron ore producers for so many years, China is also aggressively pursuing new avenues of supply in other regions like Mongolia and Africa. This means new supply, less pricing power. So the iron ore story might not have a happy ending.
The saving grace for the iron ore producers ......