Rio Tinto Renders Robust Operating Results In Third Quarter 2017

SEATTLE (Scrap Monster): Rio Tinto reported strong production volumes during the quarter ended September this year. Consequently, exports too recorded significant uptick. According to the Q3 operations review report published by the company, the iron ore shipments grew more than expected. However, the copper production volumes slumped, forcing the company to downgrade its copper guidance for the second time in 2017.

The Pilbara iron ore shipments surged higher by 6% during the third quarter to total 85.8 million tonnes (Mt). This is 6% higher when compared with the exports during the corresponding quarter last year. Out of this Rio Tinto’s share was 70 Mt. The Pilbara iron ore production too edged higher by 2% to 85 Mt. The cumulative iron ore production from Pilbara operations totaled 241.9 Mt, out of which Rio Tinto accounted for 198.4 Mt. This is 1% lower than the corresponding nine-month period in 2016.

Rio Tinto noted that the completion of the new conveyor system at Silvergrass mine is expected to complete during the fourth quarter of this year. The AutoHaul automation project of Pilbara train system has made significant progress during Q3 2017. The scheduled completion of the project by end of 2018 will lead to significant operational improvements through reduction of average cycle times. The company maintained its yearly Pilbara shipment forecast for 2017 unchanged at 330 million tonnes.

The bauxite production during Q3 2017 climbed higher by 4% over the third quarter 2016 to 12.9 Mt. The shipments too were up marginally by 2% over the year. Rio Tinto’s quarterly shipments totaled 8.2 Mt. Alumina production remained flat during the quarter. Quarterly aluminum production registered decline of 3% when matched with Q3 last year. The company expects to produce between 50 and 51 Mt of bauxite during the entire year 2017. The alumina output is projected at 8.0 to 8.2 Mt, whereas aluminum production during the year is likely to total between 3.5 and 3.7 Mt.

Meantime, the company produced lower-than-expected results in copper segment. The mined copper production tumbled by 29% over Q3 2016. The lower result was mainly attributed to the prolonged worker strike at Escondida mines, Chile and a fall in grades at its Kennecott mine in Utah. The latest reports indicate that the company has declared force majeure at Kennecott following the death of a worker earlier this week.

Rio Tinto has slashed its 2017 copper production estimates from the earlier 500 to 550 thousand tonnes to between 460 and 480 thousand tonnes. Refined production guidance for the year remained unchanged at 185 to 225 thousand tonnes.