Rio Tinto has maintained its iron ore shipment forecast for the year at between 320 million and 330 million tonnes meaning that it will end the year as the world’s top iron ore producer and exporter.
The miner said yesterday that it lifted shipments in the three months to September by 5% to 86.1 million tonnes from 81.9 million tonnes a year earlier. Production in the quarter rose 6% to 87.3 million tonnes.
That took the 9 month total for shipments to 240.6 million tonnes, down 4% from a year earlier and production to 243.1 million tonnes, down 3%.
Another quarter with shipments around the September level will see the total for the year rise to around 326 million.
If that’s the case it will see Rio finish just in front of Vale, the big Brazilian miner which this week reaffirmed its earlier lowered guidance for 2019 of 307 million to 332 million tonnes.
Vale’s shipments are recovering slowly from the impact of the mine closures ordered by various courts and governments in Brazil after the January 25 mine dam wall tragedy that left nearly 300 people dead or missing. A good portion of Vale’s exports are iron pellets meaning actual iron ore exports will be closer to 280 million tonnes of fines (and a little bit of lump).
In what was a mostly upbeat third-quarter report, Rio maintained its other guidance except bauxite which has been revised to 54 million tonnes from the previous 56 to 59 million tonnes, and aluminium which has been cut revised lower.
Rio Tinto expects its aluminium production this year to be at the lower end of its guidance of 3.2–3.4 million tonnes.
“The aluminium industry continues to face challenging conditions in global markets and policy uncertainty, reflected in declining prices,” Rio Tinto stated.
“We are focussing on enhancing the competitiveness of our smelters, including discussions with our Pacific stakeholders on energy pricing, to ensure the sustainability and global competitiveness of our Pacific smelters.”
Third-quarter aluminium production shrank 2% to 789,000 tonnes.
Rio Tinto blamed that on a preventive safety shutdown at one of the three potlines at the ISAL smelter in Iceland.
Earlier than planned pot relining at Rio Tinto’s Kitimat aluminium smelter in Canada also took a toll on the company production.
The company’s bauxite production and shipment to third parties rose 9% and 23%, respectively, on its results for the same time in the previous year. Production from non-managed joint ventures, however, was lower than the planned for the 9 months.
Rio produced 158,000 tonnes of copper, up 15% the June quarter, reflecting higher grades at Kennecott and improved throughput at Escondida.
The company’s construction of the Oyu Tolgoi underground project in Mongolia remains on track, with the central heating plant, shaft two jaw crusher system and surface discharge conveyer completed since July 2019. new cost figures should be known this quarter for the troubled project.
“We have delivered improved production across the majority of our products in the third quarter, with a solid result at our Pilbara mines driving increased sales of iron ore into robust markets,” according to Rio Tinto CEO Jean-Sébastien Jacques in yesterday’s statement.
“Our strong value over volume approach, coupled with our focus on operational performance and disciplined allocation of capital, will continue to deliver superior returns to shareholders over the short, medium and long term.”
According to data from Fastmarkets MB, the spot price for benchmark 62% iron ore fines rose 1.7% to $US93 a tonne on Tuesday.
Rio’s share price eased 0.8% to $89.81 in a market that surged all day to close up 84 points