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Major miner Rio Tinto has released its production results for Q2 2018, which cover the company’s production of various commodities such as iron ore, copper and bauxite.
Rio Tinto (NYSE,LSE,ASX:RIO) announced its production results from the second quarter of 2018, which included iron ore, bauxite, aluminium, copper, hard coking coal and titanium dioxide. The results also touched on cost inflation, temporary suspension of operations at Iron Ore Company of Canada, and growth.
Highlights are as follows:
Pilbara iron ore shipments of 88.5 million tonnes (100 percent basis) in the second quarter were 14 percent higher than the second quarter of 2017, benefiting from better weather and reflecting improved productivity across the system. Shipments in 2018 are expected to be at the upper end of the existing guidance range of 330 to 340 million tonnes (100 percent basis).
Bauxite production of 13.3 million tonnes was 3 percent higher than the corresponding quarter of 2017, due to continued operational improvements. Third party shipments increased by ten percent to 8.7 million tonnes due to firm demand.
Aluminium production of 0.9 million tonnes was 3 percent lower than the second quarter of 2017 due primarily to labour disruptions at the non-managed Becancour smelter in Canada and a power interruption at the Dunkerque smelter in France.
Mined copper production of 156.8 thousand tonnes was 26 percent higher than the corresponding quarter of 2017, reflecting strong production at Escondida following a labour union strike in the first half of last year.
Hard coking coal production was 40 percent higher than the corresponding quarter of 2017 due primarily to the impact of Cyclone Debbie last year.
Titanium dioxide slag production was 27 percent lower than the second quarter of 2017. Production was suspended at Rio Tinto Fer et Titane in Sorel-Tracy following a fatality on 26 April 2018. Production at Richards Bay Minerals has been impacted by ongoing labour disputes between contractors and their employees.
Production at Iron Ore Company of Canada was significantly impacted in the second quarter, where operations were suspended while a new labour agreement was reached. Operations returned to normal production rates by the end of June 2018.
Cost inflation is being experienced, particularly in the aluminium group with higher raw material costs. Disruptions during the first half have also impacted unit costs at IOC and RBM.
The major growth projects remain on track, with first bauxite shipment from Amrun expected in the first half of 2019 and construction of the first drawbell at Oyu Tolgoi Underground anticipated in mid-2020.
Jean-Sébastien Jacques, chief executive officer, commented:
“Operational performance was solid across most commodities, rounding out a strong first half performance for the group. Our increasingly flexible Pilbara iron ore system continued to perform well. Our bauxite and copper businesses also delivered strong operating results, demonstrating the success of our ongoing mine-to-market productivity programme, which is increasingly important in an environment of rising cost inflation. Our sustained focus on cash generation, combined with disciplined capital allocation, will ensure we continue to deliver superior returns to our shareholders across the short, medium and long term.”
Click here to read the full press release from Rio Tinto (NYSE,LSE,ASX:RIO).