From Mac bank today:
In Rio Tinto’s 2013 financial results on Thursday, perhaps the biggest surprise was the lower than expected iron ore guidance for 2014 of 295mt (100% basis, including contribution from IOC). This was well below consensus expectations, and does imply a slower than expected ramp-up in the Pilbara expansion. We had already factored in below-consensus expectations, however as a result of this we now need 9mt more Chinese domestic ore to balance the market over the course of this year. This takes the total 2014 Chinese domestic ore requirement to 258mt (62% equivalent basis), down 34mt from last year.
Given Rio could probably bring 30-40 million tonnes to market by year end if it wanted to, this is probably an acknowledgement that it has lost its little cold war of trying to talk down the prospects for smaller producers. Gina is coming come hell or high water!
