By Rishav Chatterjee
(Reuters) -Rio Tinto reported a rise in quarterly output across its copper and aluminium portfolios on Tuesday, sending its shares 3% higher, even as the miner cut its annual estimate for the Canadian iron ore business due to operational failures.
The world’s biggest iron ore producer expects an iron ore output of 9.3 million to 9.8 million tons (mt) from its Iron Ore Company of Canada (IOC) business, down from 10.0 to 11.0 mt previously projected.
“Operations at IOC were impacted by extended plant downtime and conveyor belt failures, while we also recovered from wildfires which took place in Northern Quebec in the prior quarter,” the Anglo-Australian miner said in a statement.
Rio reported a 1.2% rise in its third-quarter iron ore shipments, as it ramped up production at the Gudai-Darri mine. It shipped 83.9 mt of iron ore from Pilbara in the September quarter, compared with 82.9 mt a year earlier.
The miner, which generates 70% of its profit from its iron ore operations, saw prices of the commodity improve as top consumer China stepped up its stimulus efforts.
Rio realised a 5% increase in mined copper output to 169,000 tons, reflecting a ramp-up of high-grade underground Oyu Tolgoi mine and higher feed grades at Escondida.
“Markets are latching onto signs that (Rio’s) copper business is performing strongly, boosting confidence among investors that the strategic pivot to adapt to structural changes in demand is heading in the right direction,” said Kyle Rodda, a senior market analyst at Capital.com.
Rio also reported a 9% increase in its quarterly aluminium output to 828,000 metric tons.
The company maintained its full-year expectations for Pilbara shipments in the upper half of the 320 million to 335 million tonnes range.
Shares of the miner rose as much as 3.3% to A$119.5, as of 2355 GMT, while the mining index was up 1.3%.
(Reporting by Rishav Chatterjee and Nausheen Thusoo in Bengaluru; Editing by Sriraj Kalluvila and Subhranshu Sahu)