Rio Tinto releases first quarter production results
17 April 2020 - 8:29AM
Business Wire
Rio Tinto Chief Executive J-S Jacques said “In these uncertain
and unprecedented times we continue to deliver products to our
customers with our first priority to protect the health and safety
of all our employees and communities. We are focused on maintaining
a business as usual approach and have taken extensive measures to
ensure we can do so safely.
“All of our assets continue to operate and we achieved a very
robust production performance in the first quarter. Our world-class
portfolio and strong balance sheet serve us well in all market
conditions and are particularly valuable in the current volatile
environment. Our resilience and value over volume strategy mean we
can continue to invest in our business, and support our communities
and host governments.”
Production*
Q1 2020
vs Q1 2019
vs Q4 2019
Pilbara iron ore shipments (100%
basis)
Mt
72.9
+5%
-16%
Pilbara iron ore production (100%
basis)
Mt
77.8
+2%
-7%
Bauxite
Mt
13.8
+8%
-9%
Aluminium
kt
783
-2%
0%
Mined copper
kt
133.0
-8%
-4%
Titanium dioxide slag
kt
293
-1%
+3%
IOC iron ore pellets and concentrate
Mt
2.6
+3%
0%
*Rio Tinto share unless otherwise
stated
Q1 Operational update
- We are protecting the health of our employees and communities
through rapid implementation of health and hygiene controls in
response to Covid-19. We have also strengthened our focus on safety
programmes to ensure the safety of our employees during a period of
significant change.
- Pilbara iron ore shipments of 73 million tonnes (100% basis)
were 5% higher than the first quarter of 2019, driven by a strong
recovery across the network in March following tropical cyclone
Damien in February 2020. The portside trading trial continues in
China with the 1 millionth tonne of ore sold.
- Bauxite production of 13.8 million tonnes was 8% higher than
the first quarter of 2019, following the successful ramp-up of
Amrun in 2019. Third party shipments of 9.5 million tonnes in the
quarter were 7% higher than the same period of 2019.
- Aluminium production of 0.8 million tonnes in the first quarter
was 2% lower than the first quarter of 2019 with ISAL operating at
85% capacity in line with our value over volume strategy.
- Mined copper production of 133 thousand tonnes was 8% lower
than the same period in 2019, reflecting anticipated lower copper
grades, partially offset by higher throughput.
- At Kennecott in the US, we are working to resume normal
operations following a 5.7 magnitude earthquake on 18 March. The
mine, concentrator, tailings storage facility and refinery have all
resumed safe and stable operations. There was some damage to the
furnace, which impacts full year copper guidance (see below).
- Titanium dioxide slag production of 293 thousand tonnes was 1%
lower than the first quarter in 2019 partly due to Covid-19
restrictions in Quebec and South Africa.
- Production of pellets and concentrate at the Iron Ore Company
of Canada (IOC) was 3% higher than the same period of 2019.
- All major projects progressed well in the first quarter, but
are now being affected by Covid-19 including government imposed
restrictions on the movement of goods and people. Recovery rates
may differ across regions - we will update the market once the
situation stabilises.
- Capital expenditure is now expected to be $5 to 6 billion in
2020 (down from the previous guidance of $7 billion) partly due to
Covid-19 constraints, and partly due to the favourable currency
impact from the strong US dollar. Capital expenditure originally
planned for 2020 may subsequently flow into 2021 and 2022, and we
will provide a further update on capital re-phasing in due
course.
- We are continuing to work with our customers to fulfil orders
and meet their requirements while complying with government
directives. Our customer order books remain healthy, with our
commercial teams focusing on business continuity and customer
support.
Covid-19
Our markets
Demand in China continues to recover. In the rest of the world,
the outlook is more uncertain. Commodity supply is being disrupted
as Covid-19 restrictions impact supply chains and people movement
globally.
- Demand for the high-quality iron ores we produce remained
strong in the first quarter of 2020, mainly driven by a combination
of seaborne supply disruptions and solid demand from China’s steel
mills despite Covid-19 impacts.
- The market for primary aluminium contracted further in the
first quarter of 2020 primarily due to lower automotive
production.
- China’s demand for imported bauxite continued to grow in the
first quarter, as domestic reserves continue to decline in quality
and quantity, and mine production was disrupted by Covid-19
restrictions.
- Although copper demand remained reasonable in the quarter, the
decline in the price reflects deteriorating industrial growth
expectations globally.
- To some extent, weaker commodity prices also reflect decreasing
industry supply costs, which are falling due to a strong US dollar
and tailwinds from lower energy and freight costs, partly offset by
Covid-19 related expenditure.
Our assets
We have introduced measures to combat the spread and impacts of
Covid-19, to ensure we keep our employees and communities safe, and
our operations running. We are working closely with governments
around the world to ensure our operations continue to contribute to
society during this challenging time. Our assets are operating with
some Covid-19 restrictions in place to comply with government
directives. Full details of initiatives taken to date can be found
on our website: www.riotinto.com/news/releases. Specifically, we
have implemented the following actions:
Workforce
- We have changed rosters at our Iron Ore operations,
construction and exploration projects meaning fewer crew
changeovers at our sites and in our operations centre to reduce the
risk of transmission.
- The majority of employees and critical contractors on national
fly-in-fly-out (FIFO) arrangements have been relocated to Western
Australia.
Operations
- We have reduced mining operations at Richards Bay Minerals
(RBM) in South Africa in compliance with a government directive to
effect a lockdown on 26 March for 21 days. The rail and port remain
open for product shipments.
- We are working with the government of Quebec to comply with the
directive to slow down non-critical projects and activities for our
Quebec operations.
- We have shut down the fourth pot-line at the Tiwai Point
smelter in New Zealand (NZAS) with production continuing on the
other three lines to comply with government lockdown requirements
for containing the spread of Covid-19 and to support the health and
safety of our people at the site.
Products
- We have changed our product mix at IOC to focus on the
production of concentrates in order to match market demand.
- In aluminium, in response to market conditions we have reduced
the proportion of primary metal being produced as value added
products.
The full first quarter production results are available here
This announcement is authorised for release to the market by Rio
Tinto’s Group Company Secretary.
LEI: 213800YOEO5OQ72G2R82
Classification: 3.1 Additional regulated information required to
be disclosed under the laws of a Member State
View source
version on businesswire.com: https://www.businesswire.com/news/home/20200416005998/en/
media.enquiries@riotinto.com riotinto.com Follow @RioTinto on
Twitter Media Relations, United Kingdom Illtud Harri M +44
7920 503 600
David Outhwaite T +44 20 7781 1623 M +44 7787 597 493
Media Relations, Americas Matthew Klar T +1 514 608
4429
Media Relations, Asia Grant Donald T +65 6679 9290 M +65
9722 6028
Media Relations, Australia Jonathan Rose T +61 3 9283
3088 M +61 447 028 913
Matt Chambers T +61 3 9283 3087 M +61 433 525 739
Jesse Riseborough T +61 8 6211 6013 M +61 436 653 412
Investor Relations, United Kingdom Menno Sanderse T +44
20 7781 1517 M +44 7825 195 178
David Ovington T +44 20 7781 2051 M +44 7920 010 978
Investor Relations, Australia Natalie Worley T +61 3 9283
3063 M +61 409 210 462
Amar Jambaa T +61 3 9283 3627 M +61 472 865 948
Group Company Secretary Steve Allen Rio Tinto plc
6 St James’s Square London SW1Y 4AD United Kingdom T +44 20 7781
2000 Registered in England No. 719885
Joint Company Secretary Tim Paine Rio Tinto
Limited Level 7, 360 Collins Street Melbourne 3000 Australia T
+61 3 9283 3333 Registered in Australia ABN 96 004 458 404
Category: General
Rio Tinto (LSE:RIO)
Historical Stock Chart
From Apr 2024 to May 2024
Rio Tinto (LSE:RIO)
Historical Stock Chart
From May 2023 to May 2024