Our 2018 average total cash cost of Chinese iron ore mines is US$2/tonne higher compared to 2017 due to the costs associated with greater environmental compliance and higher diesel costs. Stricter environmental policy in China is driving change and the sector is facing challenges. We expect requirements to operate a mine in China will continue to tighten. Restrictions on open pit mining will restrict supply in key producing areas but non contestable inland provinces could potentially increase production to satisfy domestic pellet demand. Total cash costs are expected to fall in 2019 due to lower fuel prices and a weaker currency but increases are expected over the next 3 years. The strong margins evident in 2017 and 2018 are likely to remain in 2019 due to better than expected global iron ore prices, but rising production costs and weaker prices from 2020 will result in lower, and potentially negative average margins, for the foreseeable future.