Even though the western world is bracing for an economic downturn, the massive force that is China is on the opposite point of the cycle.
The Chinese Communist Party ended its strict "zero COVID" policy late last year, so business activity is ramping up in 2023.
So does this mean iron ore is an investment worth making now, despite the dark economic clouds looming in our own backyard?
And if so, which of the big producers listed on the S&P/ASX 200 Index (ASX: XJO) is the best buy at the moment?
Shaw and Partners portfolio manager James Gerrish had some thoughts:
Is iron ore ready for a bull run?
First thing to note is that Gerrish's team is "bullish [on] the resources sector" in the medium term, inclusive of iron ore shares.
In fact, Gerrish revealed that his portfolios already hold two ASX 200 giants.
BHP Group Ltd (ASX: BHP) currently takes up 6% of the flagship growth portfolio, while Mineral Resources Ltd (ASX: MIN) occupies 4%. BHP also has a hefty 6% weighting in his active income portfolio.
"At this stage we have no plans to reduce any of our exposure, which, by definition, is an endorsement of the sector," Gerrish told a Market Matters Q&A.
The BHP share price is down 13.2% over the past 12 months, while Mineral Resources is up a handy 30.4%.
Other professionals are somewhat divided on BHP, with 12 out of 24 analysts surveyed on CMC Markets rating it a hold.
There seems to be slightly more conviction for Mineral Resources, with eight out of 16 analysts recommending that one as a buy.
How about miners that only deal in iron ore?
However, if we're talking pure iron miners, Gerrish would buy into a stock that his portfolios currently do not hold.
"Fortescue Metals Group Ltd (ASX: FMG) looks constructive following a strong week post the global banking worries," he said.
"We can see a test of its mid-2021 highs this financial year which again is a positive read-through for the sector."
Unfortunately, Gerrish's peers unanimously disagree.
According to CMC Markets, none of the 17 analysts who currently cover Fortescue considers it a buy. Thirteen, in fact, recommend the stock be sold.
The Fortescue share price is more than 16% down since July 2021.
