Chinese steel production has peaked and will fall by more than 25 per cent over the next decade and a half, according to prominent economist Ross Garnaut, a drop that would undermine Australia's entire iron ore industry, cost billions in tax revenue and reduce the living standards of most Australians.

As iron fell to a decade low of $US47 a tonne over the Easter weekend, former BHP Billiton chief executive Brian Gilbertson criticised the world's biggest mining groups for flooding the market with iron ore, a strategy that he said would cost its shareholders over the long term and cost the country tens of billions of dollars of lost value for no benefit.