Accelerated rail track maintenance in response to poor weather has impacted on Rio Tinto’s iron ore shipments, with the mining giant’s second quarter operations review indicating that estimates for its yearly Pilbara iron ore guidance have lowered to around 330 million tonnes, down from a previous guidance estimate of between 330 and 340 tonnes.
Queensland coking coal guidance has also been impacted by Cyclone Debbie, with guidance now at 7.2 to 7.8 million tonnes, down from previous guidance of 7.8 to 8.4 million tonnes.
Nonetheless, Rio Tinto’s chief executive J-S Jacques said the quarter was a solid one for production, which included record bauxite output of 12.9 million tonnes.
“Iron ore production was in line with last year, although iron ore shipments were impacted by an acceleration in our rail maintenance program following poor weather in the first quarter,” Jacques said.
“We believe our focus on capital discipline, maximising cash flow from operations, driving productivity and portfolio shaping will continue to support the delivery of strong cash generation and shareholder returns.”
Iron ore shipments in the first half of 2017 were 3 per cent lower than in the same period last year, while second quarter shipments were 6 per cent lower than in 2016.
Rail maintenance is to continue throughout the rest of 2017, although at a lower level than the second quarter.
The miner’s report also stated that progress is continuing with the automation of the Pilbara train system, with the project on schedule to be completed by the end of 2018. 20 per cent of train kilometres are now travelled autonomously with drivers managing remaining safety and reliability systems.