Rio Tinto reports a 1.5% increase in iron ore shipments in the fiscal second quarter

on Jul 17, 2020
  • Rio Tinto reports a 1.5% increase in iron ore shipments in the fiscal second quarter.
  • The London-based firm's mined copper output tanks 3% on a year over year basis.
  • Rio's Bauxite production climbs 9% but aluminium production drops by 2% in Q2.

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Rio Tinto (LON: RIO) said on Friday that its iron ore shipments came in 1.5% higher in the second quarter. The company attributed the increase to China, where the steelmaking ingredient saw recovering demand as the largest Asian economy started to pull out of the COVID-19 crisis.  

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Shares of the company opened less than 1% up on Friday and jumped another 1% on in the next hours. At £49.10 per share, Rio Tino, that has a market capitalisation of £61.22 billion and a price to earnings ratio of 12.66, is roughly 8% up year to date in the stock market after recovering from a low of £30 per share in March.

Rio Tinto tops Vuma consensus for iron ore shipments in Q2

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In the quarter that ended on 30th June, Rio Tinto valued its iron ore shipments at 86.7 million tonnes that topped an estimate of 84.1 million tonnes by Vuma. In the same quarter last year, the Anglo-Australian company had shipped 85.4 million tonnes of iron ore. Rio requested environmental approval for its Winu copper project on Thursday.

According to Rio Tinto, iron ore demand did not take a massive hit from the Coronavirus pandemic in recent months as China expanded its infrastructure spending in a bid to offset the economic blow from the ongoing health crisis.

The London-based firm typically generated over 80% of its underlying earnings from iron ore. Rio expressed confidence that conditions recovered quickly in China in Q2 and were now approaching stability. The construction and infrastructure space, it added, was showing robust performance.

Rio Tinto’s mined copper output tanks 3% in the second quarter

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The world’s 2nd largest metals and mining corporation, however, remained wary of a second wave of COVID-19 that could wreak havoc for advanced economies.

As per the global miner, its output in terms of mined copper also came in stronger than expected on Friday despite an earthquake-driven disruption at its operations in Utah. 132,800 tonnes of mined copper production in the second quarter topped the experts’ forecast of 114,000 tonnes but was reported about 3% down on a year over year basis.

At 83.2 million tonnes, Iron ore output, on the other hand, came in 4% higher in the second quarter as compared to the same quarter last year. Rio’s bauxite production also surged 9% on an annualised basis in Q2, but the aluminium output was down by 2% versus last year.

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