This Iron Ore Share Is Half The Price It Should Be!

Date 26/06/2008

The Right Side

Garry White

If there is one share you buy this year, make it this one. Because right now, I can’t see a better way to potentially double your money inside the year.

And I’m not the only one who thinks so.

Let me explain...

To make modern buildings you need lots of concrete and steel. And China is the biggest consumer of them all.

Over the next few years they plan to build the equivalent of 10 New York Cities. The amount of resources they’ll need for such a feat is simply staggering... and one company is in the perfect position to supply a large chunk of the raw materials.

Here’s the thing...

To make steel you need iron. The problem for China is they don’t have any near enough within its borders... and the ore it does have is of poor quality.

That means Chinese construction companies are at the mercy of the big iron ore exporters - BHP Billition, Rio Tinto and Vale.

These miners charge what rates they like to ship the stuff over... and the cost is huge. China has NO CHOICE but cough up.

But thanks to one brilliantly positioned iron ore firm - a company listed right here in London - that could be about change.

Imagine it... an iron ore company right next door to the world’s biggest iron consumer

You see, they are in a very unique position.

Never has the saying "location location location" been more fitting. Not only do they hold vast quantities of iron ore... but they’re based right next to China’s borders.

Imagine that... a business that’s a stone’s throw away from their biggest ever customer! This is one of those rare investment situations. This company has the right commodity, in the right place, at the right time... and its management is also one of the best in the business!

It has just started to produce its first ore and a significant ramp up in production is expected over the coming months.

It’s great for Chinese steelmakers as they can now get their ore sourced locally at a far cheaper cost. It’s great for this company as they have their best customer right on their doorstep.

And it’s great for you, the investor, because you could stand to make an absolute packet in the years to come!

"These shares are half the price they should be," says one broker

By 2012, the company plans to produce up to 10.7m tonnes of iron ore concentrate. From that up to 5 million tonnes of pig iron will be produced.

It also recently announced the acquisition of two mining licenses that could double the iron resources of the company.

Broker Cannacord Adams recently reviewed all of the company’s projects. They concluded their net asset per share valuation is DOUBLE the current share price.

But I reckon that’s a pretty conservative forecast.

You see, iron prices have risen significantly. I believe they will continue to do so for many years to come. And I’m not alone...

In a recent note to clients Citigroup said: "The iron ore market remains under-supplied and only a sharp deceleration in Chinese steel production will change this. We expect iron ore to rise by 30% in 2009... but this may be conservative."

Your best chance to double your money this year?

As you can probably tell, I’m pretty fired up about this opportunity.

I believe it has real potential to double your money if all goes to plan.

That’s why it takes centre stage in the latest issue of my Smart Commodities UK advisory.

And all you have to do to get ALL the juicy details is agree to review Smart Commodities UK for three months – with absolutely no commitment required at all.

On signing up for your three month trial you’ll immediately receive an email from me. It’ll include a link to a welcome pack containing five of my core ‘must buy’ resource-based portfolio stocks.

Soon after that you will receive the latest edition, by post, with all the details of the unique company I’ve talked about today.

Click here and claim your no obligation trial to Smart Commodities UK.

Regards

Garry White
Editor
Smart Commodities UK

Please note: Forecasts are not a reliable indicator of future results.

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