In its third quarter earnings statement, Rio Tinto reported record quarterly and year-to-date iron ore shipments, production and rail volumes. Sales from the Pilbara continued to exceed production in the quarter, as the stocks that were built in anticipation of delivery of the infrastructure expansion were drawn down. The infrastructure for the 360 million metric tons per year (mt/y) expansion is 75% complete, with all rail, marine and wharf works in place.
The company increased its copper guidance for the year on the back of mined copper production being 15% higher than in the first nine months of 2013, driven by improved recoveries at the Kennecott concentrator and the sustained ramp up at Oyu Tolgoi.
“We have delivered another strong quarter with record iron ore production and a solid performance in copper and aluminum,” said Sam Walsh, CEO, Rio Tinto. “We have seen our first full quarter from the 290 million mt/y iron ore expansion in the Pilbara, with the additional tons going into our premium Pilbara blend products. Our strategy of focusing on long-life, low-cost assets means we will continue to generate strong cash flows despite a lower price environment.”
Global bauxite production in the third quarter was 7% higher than in the second quarter, as the Gove bauxite mine continued its ramp up following curtailment of the Gove refinery in May. Aluminum production in the third quarter was broadly in line with last year. Production from the new AP60 plant and productivity gains across the smelter portfolio offset the loss of production from Shawinigan, which closed in November 2013, and the partial shutdown at Kitimat as the plant continues to prepare for full commissioning of the modernized smelter in the first half of 2015.
Production of hard coking coal in the first nine months of 2014 was in line with 2013. Production of thermal and semi-soft coal was down only 3%, despite the loss of production from the Clermont mine, which was sold in the second quarter of this year due to production of thermal coal from Hail Creek and significant productivity gains achieved across other coal mines in the business.