Rio Tinto production tumbles as supply chain woes bite
Mining giant Rio Tinto has seen production take a hit over the past three months amid ongoing labour shortages and supply chain issues.
Titanium dioxide slag, which is used to make cosmetic and pharmaceutical items as well as plastic, was the worst affected material with production tumbling by 29 per cent to 209kt. The company said labour shortages, supply chain issues, weather and market conditions hampered its operations and warned that commodity prices could rise.
Rio Tinto Chief Executive Jakob Stausholm, said, “the third quarter has demonstrated the resilience of our people in dealing with ongoing COVID-19 challenges. It has been another difficult quarter operationally and despite improving versus the prior quarter, we recognise the opportunity to raise our performance.
“We have consequently modestly adjusted our guidance,” Stausholm added.
On the back of harsh market conditions Rio Tinto adjusted its guidance for prices upwards while production expectations fell.
Copper’s unit price jumped from $0.60-75 per lb to $0.75-80 per lb as a result of reduced refined copper production. Fully year guidance was reduced to 190k-210k tonnes, down from previous expectations of 210k-250k.
Iron Ore Company of Canada pellets and concentrate full year guidance has been reduced to 9.5-10.5m tonnes from 10.5-12.0m tonnes and Bauxite production is expected to fall as low as 54m tonnes from a high ball estimate of 59m.
The news follows a bumpy year for Rio Tinto with share price down 13.66 per cent since January.
Read more: Rio Tinto investigated by the FCA over claims it misled the market