Rio Tinto Scales Back Copper Production Target

  By Robb M. Stewart 
 

MELBOURNE, Australia--Rio Tinto PLC's (RIO) shipments of iron ore from its operations in Australia's western Pilbara were dented by cyclones and rough weather in the first quarter, while mined copper production was hit hard by a 43-day strike at a mine in Chile.

But while the Anglo-Australian miner scaled back its target for copper output this year, it held to its guidance for iron ore.

Rio Tinto said shipments of iron ore from the Pilbara were flat year-over-year at 76.7 million metric tons, but down 13% on the prior quarter due to cyclone activity and heavy rainfall that affected sections of its rail network and impacted ship loading. Still, it continued to expect production this year from the operations of between 330 million and 340 million tons.

Mined copper production for the first quarter was down 37% on-year and over the previous quarter, at 84,200 tons due to the strike at the Escondida mine as well as reduced production at the Grasberg operation in Indonesia. As a result, it cut its guidance for the full year to 500,000-550,000 tons from an earlier forecast of 525,000-665,000 tons, although it still expects refined copper production of 185,000-225,000 tons.

In late January, BHP Billiton Ltd. (BHP) cautioned it expected to produce less copper than previously estimated in the financial year through June after a sharp fall in first-half output and due to the threat of the strike over pay at Escondida, the world's biggest copper mine it co-owns with Rio Tinto.

Among other commodities produced by Rio Tinto, it said aluminum output reached 889,000 tons for the quarter, a rise of 2% on the year before but down 3% on the prior quarter. Coking coal production was down 20% on-year and 28% lower on-quarter at 1.58 million tons, but thermal coal output was up 4% on-year and down 1% on-quarter at 5.18 million tons.

"Despite challenging weather conditions at our West Australian and Queensland operations, we delivered solid production in the first quarter," Chief Executive Jean-Sebastien Jacques said.

Write to Robb M. Stewart at [e-mail]

(END) Dow Jones Newswires

April 19, 2017 19:26 ET (23:26 GMT)

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