Australia-based miner Rio Tinto, the world's second biggest iron ore producer, has announced that in the second quarter of the current year iron ore production from its Pilbara operations in Western Australia amounted to 83.2 million mt, up by four percent year on year and rising by seven percent from the previous quarter. In the given quarter, the company's iron ore shipments from its Pilbara operations reached 86.7 million mt, increasing by one percent from the same quarter of the previous year and up by 19 percent from the first quarter of the year owing to strong demand from steel mills in China, despite the impact of coronavirus-related operational controls.
In the first half of the year, Rio Tinto’s iron ore production from its Pilbara operations rose by three percent year on year to 161.1 million mt, while its iron ore shipments in the same period totaled 159.6 million mt, rising by three percent compared to the corresponding period of the previous year.
According to Rio Tinto, conditions in China improved in the second quarter and are likely to stabilize, while the US and Europe have started to recover. Rio Tinto noted that China continues to show demand for iron ore, while the recovery in Japan and Europe is yet to begin meaningfully. The miner underlined that employment and trade uncertainties remain, while the construction and infrastructure sectors are performing well. The company also warned that the threat of a second wave of the pandemic still poses a crucial risk for advanced economies.
Rio Tinto expects that its capital expenditure will be around $6 billion in 2020, compared to its previous estimate of $5-6 billion due to the lower impact of the coronavirus pandemic on expenditure and the favorable currency impact. The company also anticipates that the capital expenditure for 2021 and 2022 will be around $7 billion per year, rising from its previous estimate of $6.5 billion. Rio Tinto’s Pilbara iron ore production guidance for the current year has also remained unchanged from the previous guidance of 324-334 million mt.