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Rio Tinto reports rise in iron ore output

Rio Tinto iron ore “’
output is up by 8%
London, England — MININGREVIEW.COM — 15 July 2009 – Rio Tinto Group “’ the world’s third- largest mining company “’ has announced that its second-quarter iron ore output in 2009 rose 8%, and says it expects a recovery in steel demand in China to continue this half.

In a statement released here, the company says production of the ore, the biggest contributor to earnings, was 45.2 million metric tonnes in the three months to June 30, from 41.9 million tonnes a year earlier. It reaffirmed its full-year output guidance of 200 million tonnes.

CEO Tom Albanese has curbed production of iron ore, aluminum and diamonds as a global economic slump sapped demand in China, the largest metals consumer, and pushed world prices lower. Markets remained tough in the second quarter, particularly in aluminum, the company said today.

“The production curtailments announced in January in this product group have started to take effect,” Rio said. “We continue to press ahead with actions to reduce cost across the board, align production with demand, and bring down levels of net debt.”

Rio Tinto iron ore head Sam Walsh said earlier this year that the company expected sales to improve this quarter, as China’s stimulus measures spur demand for the steelmaking raw material.

Albanese last month spurned a US$19.5 billion (R156 billion) investment from Aluminum Corporation of China, in favor of raising US$21 billion (R168 billion) from a share sale and an iron ore venture with BHP Billiton Limited. The company is continuing to sell assets, and last week sold part of its Alcan packaging unit to Bemis Co. for US$1.2 billion (R9.6 billion).

Mined copper production was little changed, while Australian coking coal output fell 7%, the company said in the statement. Aluminum output dropped five 5%, it added.