"What affects the project is high costs," Mrs Rinehart said. "As I have said so many times it is really important government cost burdens are lowered. We have regulations; be it approval processes, be it permits, be it licences, be it the checks that have to go on after those compliances." She said governments needed to take regulatory costs seriously. "They have to cut these government cost burdens because our costs are incredible," Mrs Rinehart said. Roy Hill Holdings chief executive Barry Fitzgerald told the conference the mining company was subject to significant regulatory burdens. More than 4000 approvals have been required and environmental compliance was increasing.

The construction is 76 per cent complete and has collided with a halving of the iron ore price, which fell to $US58.32 per tonne overnight Tuesday, the lowest level since daily prices were introduced in May 2009. Analysts estimate Roy Hill will break even at prices between $US50 per tonne and $US55 per tonne. Mr Fitzgerald said the mining group was not under any pressure from its financiers to ramp up production more quickly in the face of lower prices. Let's assume iron ore prices that are now at $US57 go to $US30 – it is possible right? We are going to have Australia going out of business as a country. Lourenco Goncalves, Cliffs Resources "Both the shareholders and the financiers would like us very much to complete the project, to commission it and then to ramp up as efficiently and as effectively as we can," he said.

Mr Fitzgerald said the company was planning to achieve its full production of 55 million tonnes a year ahead of its publicly stated 30-month timeline. "Our view is that we can do that much more efficiently. I won't put an exact date on it but I don't think it will be 30 months," he said. "We are very much of the view that it will be far faster than 30 months." Half of Roy Hill's ore production will be soaked up by its shareholders – POSCO, Marubeni and China Steel Corporation. Mr Fitzgerald said the majority of the remainder of its product would go to Chinese customers.

"We have over 80 per cent of our production already contracted," he said. The falling price is likely to force high cost miners out of business. Roy Hill, when fully operational, will have one of the lowest cost mines in the Pilbara. "I love the Australian dollar being weaker against the US dollar," Mr Fitzgerald said. "In terms of the iron ore price, I wish it were two years ago. All we can do is deal with the situation we have. That's what is great about being a margin focused business all the time." He said a definition of failure would be to have a cost production program, because the miner needed to be "fit for purpose from day one". US-based Cliffs Resources chairman Lourenco Goncalves has a different view to Mrs Rinehart.

He argues Chinese steel mills want quality ore because of increasing environment standards. Quality ore was produced in Australia, he said. He warned BHP Billiton and Rio Tinto were on a path of "self-destruction" which would hurt the Australian economy. He said he would not describe a push by Rio and BHP to expand production amid falling prices as "strategy". "You call that strategy. I call it self destruction," Mr Goncalves, who is based in Cleveland, said. Cliffs, a high cost producer, is retreating to the US domestic market. It plans to withdraw from seaborne export markets to focus on supplying the US market.

He said West Australian premier Colin Barnett, who hit out at the majors for boosting production as prices weakened in October last year, should now "start climbing the walls". "Let's assume iron ore prices that are now at $US57 go to $US30 – it is possible right? We are going to have Australia going out of business as a country," Mr Goncalves said. "This is the most important commodity for the country." But he said governments should not intervene but rather shareholders should force change. He said Rio, BHP and Vale had destroyed $US50 billion ($65 billion) in earnings, before interest tax and depreciation in the past 13 months. "They are accountable to their own shareholders," Mr Goncalves said. "I don't believe that the government should do anything. I'm just saying businesses before anything need to be responsible and understand the consequences of their actions."

He said Cliffs was paying a price for previous management paying too much for assets, a strategy that shareholders endorsed as they pushed the stock through $US100. Mr Goncalves warned falling iron ore prices would generate lower steel prices that could trigger deflation and economic instability.