"So I don't think there is room for two new WA projects. If you put 5Mt of new slab on the market tomorrow, it would be very hard to get it away without collapsing the price."

Austeel might decide to kick off with a DRI plant, and add on a slab plant at a later stage. However, even that course would prove difficult. "Someone says ‘I'm going to start up an HBI plant in the Pilbara'. From an investment point of view, that would be difficult after the BHP experience. There will be some psychological hurdles to overcome."

AGA's Parker remains confident. "We have a reputation in WA of having a quite complex processing industry, using our gas reserves with low value orebodies. I look no further than the south west alumina industry, where you've had the transformation of a very low value bauxite orebody into alumina exports. That hasn't happened overnight; it has taken 30-40 years to develop. It will happen in other markets such as iron ore, but when you are dealing with such capital intensive projects, and complex technological processes, these things don't happen overnight."