Rio’s Q2 production report is out and there’s no stopping the iron ore deluge. Rio confirmed its guidance for 2013 at 265 tonnes:
- Record first half iron or production, shipments and rail volumes despite conveyor belt breakage resulting in one of five ship loaders being side-lined for almost three weeks in and unseasonal wet weather which led to flooding in the Pilbara.
- Expansion of Pilbara capacity to 290 million tonnes per year remains on budget and on time to deliver first tonnages bu the end of the third quarter of this year. Delivery of first tonnages will be followed by a steady commissioning and ramp up period.
- Fist half 2013 sales of 111 million tonnes set a new record for a first half and were two percent higher than the same period in 2012. Second quarter sales were lower than production due to interruptions in shipping caused by the conveyor belt breakage and significant flooding in the Pilbara.
- Approximately 30 percent of sale were in the first half of 2013 were priced with reference to the prior quarter’s average index lagged one month. The remainder was sold either on the current quarter average, current month average or on the spot market.
- The phase two expansion of the port, rail and power infrastructure to 360 Mt/a is currently underway. A number of options for mine capacity growth are under evaluation, including the development of new mines and incremental tonnes from further productivity at existing mines.
The battle of the billionaires will be something to watch.