Barnaby Joyce's colleagues may take a dim view of his involvement in Gina Rinehart's family battle, but they too could soon be caught up in a much bigger dispute that involves Andrew Forrest, writes Ian Verrender.

Gina Rinehart last week flew back into a storm.

While she could take some comfort from confirmation that she retained the mantle of the country's richest, best connected and most powerful individual, that was where the good news ended.

Plunging iron ore prices have torched close to $6 billion of her net wealth in the past year, making her something of a metaphor for the entire nation.

Like the nation, Rinehart carries huge household debt. She and her Asian partners have borrowed $US7.2 billion to build the Roy Hill mine near Newman in Western Australia's Pilbara district. On her own account, it's the biggest single private debt raising in history.

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The mine is scheduled to ship its first ore in September, ramping up to full production of 55 million tonnes a year by late next year; adding even more material to a heavily oversupplied market.

For Rinehart it is a huge gamble. Rather than simply bank the proceeds of a lucrative royalty agreement with Rio Tinto - worth an estimated $1 billion a year - she has staked the fortune on a double or nothing bet where the odds rapidly are shifting against her.

But it is the dispute within her own family that could unravel the entire enterprise. Should her children reverse the ownership change Rinehart engineered in Hancock Prospecting back in 1995, the entire venture could implode, making it one of most spectacular wealth mismanagement episodes in the history of mankind.

It is into this cauldron that our very own Agriculture Minister, Barnaby Joyce, has waded. Taking sides in a family at war is always a fraught exercise, especially when it is not your own family. But take sides Barnaby did, four years ago sending an email from his parliamentary account to one of Rinehart's daughters, Hope, urging her to drop legal action.

His parliamentary colleagues may take a dim view of his personal involvement. But they too could soon be caught up in a much bigger dispute where they will be forced to decide between what its best for a billionaire and what is best for the nation.

After months of seemingly erratic behaviour, Rinehart's neighbour, Andrew Forrest, finally has begun to unveil snippets of his end game strategy.

If he pulls it off, it is a strategy that could see him emerge from the iron ore wars with a vast personal fortune and with his legacy as one of the world's great entrepreneurs intact.

It now appears that his end game could involve selling a large portion, or perhaps even control, of his hugely indebted Fortescue Metals Group to the Chinese government.

Should that occur, it would be a disaster for Australia.

It would be a disaster for the simple reason that Fortescue, by the sheer weight of its production volumes, could be used by China as a means to permanently depress the price of iron ore and denude the nation of export revenue.

China is the largest single buyer of iron ore, accounting for 70 per cent of seaborne trade. Naturally, it has a vested interest in keeping a lid on prices. Ensuring Fortescue's survival, and flooding the market with supply, would fit that strategy.

It is a decision that Joe Hockey ultimately will have to decide, just as his predecessor Wayne Swan was forced to confront China's pounce on Rio Tinto in 2009.

Just like Swan, Hockey will be forced to balance the diplomatic and commercial consequences of any decision. Rejecting a Chinese government-led incursion into our biggest export earning industry would infuriate Beijing.

It could also lead to a corporate collapse, the loss of thousands of jobs and billions of investment dollars.

Given both Hockey and Tony Abbott's willingness to support Forrest's bizarre call for an inquiry into iron ore, it would appear they could be persuaded to take the easy path and rubber stamp a Chinese incursion.

Swan was saved the headache by a convenient offer from BHP to "merge" its Pilbara iron ore operations with Rio Tinto; an offer Rio deemed too good to refuse even though global competition regulators would never have allowed it. Which they didn't.

It is a strategy Hockey would do well to consider.

Until recently, Fortescue was viewed as a "swing" producer. As a higher cost operation, with lower grade ore, it was always presumed that should export prices fall, it would be the first major casualty. If it did fail, tragic as that would be for employees and investors, the removal of so much supply would help boost prices and hence salvage national income.

The company's vulnerability was first exposed in late 2012 when prices suddenly dropped below $US100 a tonne. Crisis was averted when export prices recovered. But the near death experience jolted Forrest into action and the company embarked on a singeing cost cutting regime.

So far that's worked, even as prices have dropped to the low $US50s. But the prospect of a major lift in supply from Brazil, continued expansion from Rio Tinto and BHP and the emergence of Rinehart's new mine could tip the balance back to Fortescue's breaking point.

Diminutive in stature he may be, but Forrest has more front than a double-decker bus, as his recent campaign demonstrates.

First up, he called for a cartel, an alliance of Australian producers to restrict supply and boost prices. If it wasn't illegal, it could work for a short period - until Brazil's massive new mine came on stream.

It was an argument that also ignored Fortescue's role in the oversupply of iron ore. In the past four years, it has been responsible for the biggest increase in iron ore supply.

Then, Forrest switched tactics. He accused BHP and Rio Tinto of rigging the market, forcing prices lower (as opposed to his earlier call to rig the market and force prices higher).

He employed emotion and bandied about pejorative terms. No longer were BHP and Rio competitors, they became "multinationals". They had "announced" deliberate "over-supply strategies".

The multinational tag could just as easily be applied to Fortescue. A Chinese government controlled entity, Hunan Valin, owns about 15 per cent and, apart from Forrest's controlling stake, foreign investors loom large on the register.

For all his bluster, the charade about an iron ore inquiry now is exposed for what it truly is - an attempt to muddy the waters about increased Chinese ownership either of Fortescue mines or the company.

Never once has Forrest accused China of subsidising its own domestic iron ore production or criticised its wildly uneconomic venture with Clive Palmer. Nor is he outraged by China's sudden cozying up to Brazil to ensure a huge lift in output.

Like Barnaby Joyce, however, he has in the past weighed into the Rinehart family spat. Unlike Joyce, Forrest backed Rinehart's son John Hancock. A new, lower cost mine with richer material right next door is the last thing Twiggy needs right now.

Ian Verrender is the ABC's business editor.