Sydney, Australia — 18 April 2012 – Mining giant Rio Tinto has reported worse falls than expected in iron ore and copper production in the first quarter of 2012, after it had been hit by bad weather, knocking the global miner’s shares lower.
Reuters quotes a company statement issued here saying Rio Tinto “’ which is the world’s second biggest producer of iron ore after Vale, and a key supplier to the Chinese steel sector “’ said its share of production from mines it owns outright and in joint ventures had dropped 11% to 45.6Mt in the quarter versus 51.2Mt in the previous three months. Analysts had been expecting
output closer to 50Mt.
Iron ore production on a 100% basis in the March quarter was 59Mt versus 65Mt in the previous quarter. The shortfall has been helping shore up seaborne-traded iron ore prices despite slowing demand from China, the biggest buyer of Australian ore.
Mined copper output fell 13% to 119,500t against analysts’ forecasts of above 140,000t.
Rio Tinto gave no detailed commentary on demand, but there have been market concerns that commodity imports by China will drop off this year in step with slowing industrial growth.
Heavy rain and two early-season cyclones drenched Rio Tinto’s Paraburdoo mines during the quarter, while high sea swells generated by cyclones disrupted freighter movements at the ports
of Dampier and Cape Lambert, used by Rio to ship all its Australian ore.
“We had a solid first quarter with increased production of, coal, bauxite, alumina and titanium dioxide compared with the first quarter of 2011,” Rio Tinto chief executive Tom Albanese said
in its latest quarterly operations report.
Rival BHP Billiton is expected to report weather-related disruptions to its Australian iron ore operations tomorrow.
Source: Reuters. For more information, click here.