/* Style Definitions */
mso-padding-alt:0cm 5.4pt 0cm 5.4pt;
font-family:”Times New Roman”;
Results from Rio Tinto’s third quarter production report indicate the company is on track to breaking last year’s record $US 14.32 billion profit.
The latest production figures show Rio set new quarterly records for its iron ore sales, which are the main driver of the company’s profits.
Its coking coal production also set records.
Rio has been ramping up production through the year to meet its 240 million tonne annual target after reporting a half year production of only 114 million tonnes.
This week Rio Tinto chief executive Tom Albanese said he didn’t foresee a downturn in iron ore demand from China despite concerns about the country’s slowing steel demand.
Spot prices for iron ore have weakened 9 per cent in the past month to $US 162 a tonne following China’s steel slowdown.
But the price is still significantly higher than last year’s average of $US 135.
In an ASX statement Albanese said while there continued to be economic and spot price instability the core of the business remained solid.
“Whilst we are mindful of current market volatility, the fundamentals are holding up well, particularly for bulk traded commodities,” he said.
Outside coal and iron ore the business was not performing as strongly, with global copper production down 32 per cent in the quarter.
Much of the drop was due to industrial action by workers in Chile and Indonesia.
A two-day suspension of mining at the company’s Brockman 2 site in the Pilbara due to a fatality has also dented iron ore figures.
However analysts say the commercial impact of the suspension will be negligible.
Close rival BHP Billiton is due to make its third quarter report on October 19.
Its results are also expected to be strong, building on already good results from its previous quarter.
Ongoing industrial action at metallurgical coal mines operated by BHPB for the BMA alliance have been one of the biggest problems for the company’s production figures.