< BACK ...plunge to minus fifty, billions of dollars of equipment is lined-up, waiting for Champion's board to push the button on a mining restart.
     As iron ore has rallied, O'Keeffe's deal looks almost absurd, like buying a tower block for the price of a stapler. The price was “very, very surprising,” one Canadian politician told reporters at the time. But O'Keeffe's team argued (successfully), when they bought the mine, that it should be priced as a liability.
     Iron ore was crashing through successive lows and companies were either buckling, or upping production, to drive down unit costs. Prices had fallen 80 per cent. Rio Tinto was on the brink of curtailing production at its IOC mine in Labrador, according to a leaked memo, whilst the nearby Wabush mine was shuttered and its assets stripped. Bloom Lake's hanger-like buildings, which have never turned a profit, looked like a mining tombstone.
     Confidence was so low that few even noticed the Bloom Lake deal go through. Quebec's government stepped in to support the transaction, like a lender of last resort, buying the mine's railway link and port, plus shares in Champion Iron.
     Analysts who spotted the agreement only noted that government intervention would deepen the downturn. Quebec's decision “is likely to prolong” a “multi-year long depression” for iron ore, one bank in London told clients. “Prices are sending a powerful message: iron ore capacity has to permanently close.”
     A year later and iron ore has turned on a dime. Mining giant Vale announced last month that as it cranks-up a vast new mine in Brazil, it will either close or pull-back production from its higher cost operations. Rio Tinto's new chief executive, Jean-Sebastien Jacques, has also swung the group's strategy around, saying he is willing to take tonnage out of the market, curtailing production, if prices falter.

     “Shipments are slowing down,” says Bernstein analyst Paul Gait, who monitors weekly iron ore volumes by satellite. “The mantra of value over volume is gaining momentum,” according to Investec.
     Higher prices will quickly feed through into higher profits for the world's largest iron ore miners and the industry will learn to stop chasing meaningless production records, O'Keeffe argues. “The lower value tonnes are not being mined, so production is pretty flat, but the bang for your buck's better.”

     As prices recover, it has become all too apparent how few companies capitalised on the downturn, by buying-up mines at the bottom of the market.
     Metal prices fell for five years, but outside of gold, Champion is one of only a handful of companies to have scooped-up assets out of all proportion to everything else in its portfolio: Lundin Mining bought the Candelaria copper mine in Chile, coal miner Westmoreland mopped up coal mines across the US, whilst Labrador-based Altius Minerals snapped-up more than a dozen royalties in copper, potash and coal.
     In each case, the companies are run by single-minded company founders, who look at their own map, pushing through deals, against the overwhelming weight of the market consensus. “When you have nine people out of ten saying you've totally got it wrong, sometimes you question your own sanity,” O'Keeffe says. “But we backed it by putting our own money in.”
      A small number of private equity investors have also piled in and Champion's shares have rocketed, tripling in twelve months. O'Keeffe bought the bulk of his own shares last year, at prices as low as 11 cents. Champion is now trading at 48 cents. “Fair play to him,” one banker new to the story says.
      “There's an element of Humpty Dumpty...