Rio Tinto hits iron ore output, shipment records

Mining giant Rio Tinto unveiled fresh production and shipment records for its flagship iron ore business Thursday, with both up five percent on-year in 2013. Anglo-Australian Rio said iron ore shipments were up six percent quarter-on-quarter in the final three months of 2013 and production was three percent higher, boosting annual readings for both by five percent compared with 2012. Iron ore output for 2013 was 266 million tonnes, one million tonnes ahead of guidance despite a cyclone forcing operations to shut down for several days in December. "These are excellent fourth quarter operational results, demonstrating continued delivery on our commitments," said Rio chief Sam Walsh. "We have set new records for iron ore production and shipments as we ramp up our 290 (million tonnes per annum) expansion, as well as achieving an impressive recovery in copper volumes and record annual production for both bauxite and thermal coal." Production was up across the board for Rio, with steelmaking coal ahead two percent at 8.2 million tonnes and thermal coal burned to produce electricity 12 percent better at 26.8 million tonnes. Bauxite was up 10 percent (43.2 million tonnes) and aluminium three percent (3.5 million tonnes), with a significant 15 percent boost to copper, where production (631,500 tonnes) beat guidance (590,000 tonnes). Investors welcomed the news, with Rio's shares jumping more than two percent in the morning session to Aus$65.60. The robust production update follows Rio publishing dramatic spending cuts last month due to soft commodity prices and a volatile outlook, with plans to halve capital expenditure by 2015 in a bid to bolster the bottom line. Rio posted a 72 percent slump in first-half profit to US$1.72 billion in August, off the back of a loss in 2012 -- Rio's first in 18 years -- that cost then-chief Tom Albanese his job. Walsh was brought in with orders to bring the company back into the black, despite softening commodity prices as China's economy slows and greater supply comes online. He has reduced Rio's workforce by 3,800 since June 2012, with another 3,000 jobs divested out of the company as part of a US$3.3 billion sell-off of various coal, gold, copper and nickel assets. Operating costs were slashed by some US$2 billion in 2013 and exploration and evaluation spending was halved to US$948 million from $1.97 billion the previous year.