The latter two enjoy a cost advantage over Vale due to the geographical proximity of Asia-Pacific countries to Australia from where they primarily ship iron ore.

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Tata, which mines all the iron ore and coal it needs, now aims to carry out primary steel production close to its iron-ore deposits, and then ship semi-finished steel for finishing close to foreign consumer markets.

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Vast ship-borne imports of iron ore, coal and bauxite make up other raw ingredients for Chinese growth.

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China needs iron ore and unobstructed energy imports a lot more than it needs drop-ship warehouses in Reno.

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For instance, Nekvasil visited a ship Friday in Indiana Harbor, Indiana that's designed to carry 76, 000 tons of iron ore.

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