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The Labrador Trough in Canada is an iron ore story. … The big question mark for the Labrador Trough right now is transportation. The current rail line is near capacity. CN just announced it was suspending its study on a new rail line, which sent most of the Labrador iron stocks into a tailspin. It will take time to resolve this issue. … There is too much value in the region for it to stay landlocked, but the transport issue will determine the short-term direction.
… Champion Iron Mines Ltd. (CHM:TSX) … [prefeasibility] numbers were pretty good, but it has to deal with the rail situation noted above. It is one of the most advanced developers in the region with large resources so it’s worth watching.
Cap-Ex Ventures Ltd. (CEV:TSX.V), the other company in the area I follow, issued a very impressive initial resource … [it's] quite thick, good grade, flat lying and at or near surface. A 7.2 Bt resource is very large and it still has room to grow. Cap-Ex has the same challenge of convincing traders that the transport issue can be handled, but it’s also very inexpensive compared to the size and quality of resource it controls.