Mixed results for FMG and Rio

Fortescue Metals Group and Rio Tinto have reported strong production for the past quarter, but have warned of cost blowouts and declining economic conditions.

In the three months to June FMG shipped 17.8 million tonnes of ore, a massive 40 per cent rise on the previous quarter's 12 million tonnes.

But the company also reported a $582 million cost blowout for its Solomon development, and said it needed to raise a further $1 billion to finance the project.

Rio Tinto produced 48.6 million tonnes of iron ore for the quarter, a figure slightly lower than last year's result.

In a statement Rio boss Tom Albanese said while the company was still performing strongly economic volatility was having an impact across the board.

"Global economic conditions and sentiment dropped markedly in the second quarter," he said.

"We are keeping a close eye on the pace of the US economy, the continuing eurozone crisis and the impact of efforts to stimular the Chinese economy on the markets that we serve."

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