Rio iron ore ship­ments up 3pc

Pilbara News - - News - Prashant Mehra

Rio Tinto’s tar­get for im­proved ore ship­ments in 2017 re­mains in­tact but softer-than-ex­pected per­for­mances at sev­eral cop­per mines has clouded its out­look for that key busi­ness.

The min­ing giant shipped 327.6 mil­lion tonnes of iron ore from its Pil­bara op­er­a­tions in 2016, up 3 per cent from 2015, and hit­ting the mid-point of a guid­ance range that was low­ered by Rio Tinto in Oc­to­ber.

The world’s sec­ond largest iron ore ex­porter still ex­pects ship­ments in 2017 to be be­tween 330 mil­lion and 340 mil­lion tonnes.

“We have de­liv­ered a strong op­er­a­tional per­for­mance in 2016, un­der­pinned by our drive for ef­fi­ciency and max­imis­ing cash flow,” chief ex­ec­u­tive Jean Se­bastien Jac­ques said in a state­ment, adding that the com­pany’s dis­ci­plined ap­proach would con­tinue in 2017.

The rise in ship­ments in 2016 was helped by min­i­mal weather dis­rup­tions in the three months to De­cem­ber. Rio’s iron ore ship­ments in the De­cem­ber quar­ter were up 8 per cent from the pre­ced­ing three months.

The com­pany said sales in the De­cem­ber quar­ter ex­ceeded pro­duc­tion by 2.2 mil­lion tonnes, pri­mar­ily through a draw­down on in­ven­to­ries built at the ports in the third quar­ter.

But Rio Tinto’s pro­duc­tion re­port was clouded by a dis­ap­point­ing per­for­mance in its cop­per divi­sion.

An­nual cop­per pro­duc­tion rose 4 per cent from a year ago to 523,000 tonnes, but was well below the com­pany’s guid­ance range of 535,000 to 565,000 tonnes.

Mr His­sey said iron ore is ex­pected to record se­quen­tially bet­ter earn­ings in 2017, given the av­er­age price im­prove­ment. The miner also topped pro­duc­tion fore­casts for baux­ite and cok­ing coal, while alu­minium out­put jumped 10 per cent in 2016.

Pic­ture: Tom Zaun­mayr

A bulk car­rier leav­ing port full of iron ore.

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