(Australian Associated Press)
Rio Tinto has maintained its target for iron ore shipments in 2018 after hitting the lower end of its full-year guidance in 2017.
The world’s second largest iron ore exporter shipped 330.1 million tonnes of iron ore from its Pilbara operations in 2017, in line with its full-year guidance of between 330 million and 340 million tonnes.
Shipments were up one per cent from the previous year’s 327.6 million tonnes.
Rio expects to ship between 330 million and 340 million tonnes in 2018 from its main mining hub in Western Australia.
Chief executive Jean-Sebastien Jacques says the business had performed well in the fourth quarter, finishing the year in line with guidance across all major products.
“Our focus on value over volume and mine-to-market productivity, along with disciplined allocation of cash, will ensure that we continue to deliver superior shareholder returns in the short, medium and the long term,” Mr Jacques said in a statement on Tuesday.
Rio shipped 90 million tonnes of iron ore in the three months to December 31- a record quarter and up three per cent from a year ago – helped by ongoing improvements to the rail network, along with increased flexibility across the infrastructure system.
Fourth-quarter production was also three per cent higher from the preceding three months at 87.9 million tonnes.
But Rio’s 2017 mined copper production of 478,000 tonnes was nine per cent lower than 2016’s 523,000 tonnes, primarily due to the impact of a 43 day strike at the Escondida mine in Northern Chile in the first quarter.
It has forecast 2018’s copper production will be between 510,000 and 610,000 tonnes, while refined copper production is expected to be in the 225,000-265,000 tonne range.
Meanwhile, bauxite production was up six per cent on 2016, but aluminium production was down one per cent with strong operational performances offset by reduced production at the Boyne and Sohar smelters.
Rio expects between 49 and 51 million tonnes of bauxite and 3.5 to 3.7 million tonnes of aluminium in 2018.
RBC Capital Markets’ mining analyst Paul Hissey said Rio had delivered a “strong set or results” to round out the year, and said key projects are progressing as expected.
He said Rio’s recent plan to sell its Aluminium Dunkerque smelter in France to Liberty House Group – the company that bought Rio Tinto’s Lochaber smelter and assets in Scotland in December 2016 – for $US500 million ($A700 million) represents further optimisation of the portfolio.
“We believe Rio remains in good shape heading into 2018, though it appears fully valued at current levels,” Mr Hissey said.
Rio shares slipped 54 cents, or 0.7 per cent, to $81.26 on Tuesday in a lower Australian market, while BHP Billiton also lost ground, falling 0.8 per cent to $31.66.