The mining industry’s punishing iron ore price war is being led by its biggest players. But the fourth-largest iron ore miner in the world has finally raised the white flag.

At a recent Australian Chamber of Commerce dinner in Shanghai, Fortescue Metals Group Ltd. (ASX: FMG, OTC: FSUMF) Chairman Andrew “Twiggy” Forrest called for miners to cap iron ore production in order to drive prices back up.

The price of iron ore has plunged nearly 60%, to USD57.41 per metric ton, since an interim peak back in December 2013. China, the world’s largest consumer of iron ore, is in the midst of a slowdown, just in time for the glut of production resulting from the tail end of the decade-long global resource boom.

But rather than cut production to prop up prices, mining giants have been boosting production in a ruthless race to the bottom.

With a strategy not entirely dissimilar to the one OPEC is pursuing in the oil market, the biggest miners in the world hope that by driving prices lower they’ll be able to grab more market share by sidelining higher-cost competitors. Along the way, they’ll also be able to pick up plum assets from troubled companies on the cheap.

Although mining heavyweights such as Rio Tinto Ltd. (ASX: RIO, NYSE: RIO) and BHP Billiton Ltd. (ASX: BHP, NYSE: BHP) won’t escape some bruising, they’re still profitable at current levels and can use the downturn to position themselves for even greater dominance in the long term.

Like Rio and BHP, Fortescue’s cost of production is still well below the current price of iron ore. But unlike Fortescue, Rio and BHP have the scale and the assets to really cut costs to the bone.

While Fortescue says its break-even price is USD41 per metric ton, Rio and BHP have break-even prices of $18.70 per metric ton and $20.35 per metric ton, respectively. All three companies expect to push their break-even prices even lower in the months ahead.

Nevertheless, Fortescue is clearly the laggard when it comes to cost-efficiency. And perhaps that’s what precipitated Mr. Forrest’s call for a pact to slow production and help prices rebound.

According to Australia’s ABC News, Mr. Forrest told attendees at the dinner, “I’m absolutely happy to cap my production right now.”

“All of us should cap our production now,” he continued, “and we’ll find the iron ore price will go straight back up to $70, $80, $90.”

He then cynically shifted from pure self-interest to more patriotic concerns, as he noted that a price crash for Australia’s top export is hardly helpful for the country’s tax receipts.

“And when you’re just driving for market share at any cost, and you’re smashing the revenues of your host nation, and you’re smashing the revenues of your shareholders, in the end you smash your own personal credibility.”

Then he delivered his final insult. “Why don’t those companies who derive their fortunes from our nation act like grown-ups and just agree to cap their production?”

Unfortunately for Mr. Forrest, his comments, which imply a form of collusion, roused the interest of Australian regulators.

Australian Competition & Consumer Commission (ACCC) Chairman Rod Sims has called upon Fortescue’s chairman to explain his remarks. “In general terms, any attempt by Australian businesses to encourage competitors to restrict outputs is a matter of grave concern to the ACCC,” Mr. Sims said.

The ACCC has a mandate to detect, disrupt and deter any cartel conduct, anti-competitive agreements, price-fixing, or attempts to bring about collusive arrangements. And the agency says that mere attempts to engage in cartel conduct may be sufficient to constitute a breach of the law.

The company has defended Mr. Forrest’s remarks as being perfectly legal, though the ACCC has challenged its interpretation of the law.

Beyond regulatory concerns, there’s also pride at stake. Mr. Forrest’s comments have been met with confusion, at best, and ridicule, at worst.

For instance, The Australian reported that in remarks before a Mineral Council lunch Rio Tinto CEO Sam Walsh characterized Mr. Forrest’s price-cap proposal as “absolute nonsense” and a “hare-brained scheme that’s just not going to work.”

“I have no idea what was going through Andrew’s mind at the time he raised the issue,” Mr. Walsh continued.

The one thing that’s clear from this imbroglio is that Fortescue is ailing in this environment. And we would expect nothing less of Rio and BHP than to take full advantage of it.