Rio Tinto (RIO:NYSE) was up 2.62% on Tuesday after reporting record iron ore production and sales in its third quarter results.
The mining giant shipped 68 million tonnes of iron ore in Q3 2013 – an 11% improvement on the previous quarter. Iron ore sales represent more than two-thirds of the company’s revenue.
Copper production rose by 23% versus Q3 2012 – a figure supportive of the prevailing view that copper production will go into oversupply this year.
As operations at Oyu Tolgoi in Mongolia continue to ramp up, the company is still trying to resolve issues with Chinese customs officials. The mine now produces 100,000 tonnes of ore per day – its maximum processing capacity – but Chinese buyers have yet to receive purchased concentrate. The product is being warehoused and will not be reflected in Rio’s revenue until its moved. Rio expects sales to be aligned with production rates by the end of the year.
On the Canadian side of things operations were also up, with year-to-date iron ore production 12% higher than last year. Concentrate expansion at the Iron Ore Company of Canada is expected to be complete by the first half of 2014.
Under pressure to implement cost-cutting measures, the company says these activities are surpassing its expectations. After announcing plans to slash exploration costs by $750 million this year, the miner has already nearly reached this target and expects to exceed it.
Rio also had an update on the Kennecott copper mine in Utah where a pit collapse in April stalled production. The mine “continues to recover ahead of expectations,” the company’s CEO Sam Walsh said in a news release. Expectations for mined copper have been upgraded to 185,000 tonnes for the year – higher than last year’s output.