15/10/2021 - 14:44

Rio cuts iron ore guidance

15/10/2021 - 14:44

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Iron ore production at Rio Tinto’s Pilbara operations dropped by four per cent over the September quarter as the resources giant continued to feel the pinch of a strained labour market in the state.

Rio cuts iron ore guidance
Rio Tinto has further downgraded its shipment estimates. Photo: Gabriel Oliveira

Iron ore production at Rio Tinto’s Pilbara operations dropped by four per cent over the September quarter as the resources giant continued to feel the pinch of a strained labour market in the state.

The company further trimmed its forecast total Pilbara shipments from the 325 million tonnes to 340mt range to between 320mt and 325mt due to ongoing global supply chain disruptions and limited access to workers.

Rio said it had suffered more delays in completing the new Gudai-Darri mine and its Robe Valley brownfield mine replacement project.

In a similar turn of events to the previous quarter, Rio attributed the setbacks to ongoing heritage management and brownfield mine replacement tie-ins.

Rio’s share of shipments for the period reached 69.9mt out a total 83.4mt representing a two per cent increase on the prior corresponding period, while production of 83.3mt was four per cent lower.

Iron Ore Company of Canada pellets and concentrate full year guidance has been reduced to 9.5mt to 10.5mt.

Refined copper guidance was also adjusted to 190,000t to 210,000t after an incident at the Kennecott smelter resulted in a force majeure on customer contracts in September.

Rio chief executive officer Jakob Stausholm said it had been a difficult quarter operationally.

“The third quarter has demonstrated the resilience of our people in dealing with ongoing COVID-19 challenges,” Mr Stausholm said.

“Despite improving versus the prior quarter, we recognise the opportunity to raise our performance.”

The company maintained a $18.0 to $18.5 per tonne 2021 unit cost guidance, despite a drop-off in the iron ore price over the period, affirming prices remained “reasonably supported.”

Rio shares close the day down 0.91 per cent at $99.60.

 

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