China will overplay it's hand in the South China Sea dispute, which will lead to an ever-widening fear throughout SE Asia and (especially) Australia of a natural resource hungry, war mongering China.
Led by the U.S. due to Law of The Sea issues, punishing trade sanctions will be at least threatened, if not imposed, by the U.S. and it's allies, though NOT by the U.N. due to Security Council vetoes.
Iron Ore exports to China from Australia (and possibly Brazil, whom respectively supply 65% and 30% of China's imports) will be throttled severely, if not banned, as being essential to China's defense industry. You can't build submarines, tanks and artillery shells without steel!
The world's major Iron Ore producers/exporters (BHP, Vale, Rio Tinto, Fortescue etc.) will be forced to bow to the sanctions. Rogue producers (Iran, South Africa, North Korea etc.) and the smugglers will be unable to make a dent in China's staggering needs.
Although (in anticipation of an adverse ruling coming from the Hague shortly) China Inc. is currently (2016) allowing/encouraging port stockpiles to rise to record levels, there is a limit beyond which it is simply too expensive and logistically challenging to stockpile further.
China currently consumes over 4.0 Million Tonnes of Iron Ore (62% basis)DAILY, of which 3.0 Million Tonnes are imported!
Given time, China could re-start and expand their own (unbelievably low grade and therefore expensive) Iron Ore mines, and by denying steel to their civilian industry, potentially lessen their need for imports.
But long before that occurs, at some point Iron Ore prices will have surpassed $200, and possibly by a wide margin.
Challenge Brad A Resnick to a bet on this prediction!