Rio Tinto ups iron ore and coal production

Rio Tinto has announced a 12 per cent increase in iron ore production, with shipments of the commodity up by 9 per cent.

Global iron ore shipments of 72.5 million tonnes were nine per cent higher than in the first quarter of 2014.

Production of 74.7 million tonnes was a 12 per cent increase year on year.

Quarterly sales of 69.3 million tonnes from the company’s Pilbara operations were eight per cent higher than in the first quarter of 2014 but 12 per cent lower than in the fourth quarter of last year. Rio said this was a result of weather impacts from Tropical Cyclone Olwyn and a train derailment which temporarily blocked the inload train circuit at Dampier.

The miner said it remains on track to meet its 2015 shipping guidance of 350 million tonnes from operations in Australia and Canada.

Meanwhile, Rio also announced bauxite production set a new first quarter record and was four per cent higher than the first quarter of 2014, primarily due to a strong performance at Weipa which continued to ramp up.

Production from the Gove mine has now reached a run-rate of seven million tonnes per annum and is gearing up to reach an eight million tonne per annum run-rate by the fourth quarter of 2015, as infrastructure constraints continue

First quarter aluminium production was in line with the same period of 2014, as capacity creep across the smelter portfolio, combined with restarted capacity at the Boyne smelter in Australia, offset lower production from Kitimat where preparations continue for first hot metal at the modernised smelter by mid- 2015.

Rio Tinto’s share of production remains unchanged and is expected to be 43 million tonnes of bauxite, 8 million tonnes of alumina and 3.3 million tonnes of aluminium.

Hard coking coal production was ten per cent higher than the first quarter of 2014 as a result of improved production rates at Kestrel South as the longwall ramps up and was 22 per cent higher than the fourth quarter of 2014 which included a longwall panel changeover.

Thermal coal production was five per cent higher than the first quarter of 2014 primarily due to increased tonnage at Hail Creek where production from a processing plant by-product stream was prioritised in order to deliver increased margins in current market conditions.

In 2015, Rio’s share of production is expected to be 18 to 19 million tonnes of thermal coal, and 7.1 to 8.1 million tonnes of hard coking coal.

Rio’s CEO Sam Walsh said he was pleased with the company’s solid production performance during the first quarter.

“By making best use of our high quality assets, low cost base and operating and commercial capability our aim is to protect our margins in the face of declining prices and maximise returns for shareholders throughout the cycle,” Walsh said.

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