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Apr 17, 2018

Rio Tinto keeps production forecast as iron shipments rise

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Global miner Rio Tinto (RIO.N) said on Wednesday its first-quarter iron ore shipments rose 4.7 per cent from a year ago, helped by fewer weather disruptions during the period and productivity improvements.

The world's second-biggest supplier of the steel-making ingredient shipped 80.3 million tonnes in the quarter ended March 31, up from 76.7 million tonnes last year.

"We delivered a solid operational performance across most commodities in the first quarter of 2018," Rio Tinto Chief Executive Jean-Sebastien Jacques said in a statement.

"Our world-class Pilbara iron ore assets continue to demonstrate flexibility and the benefits of increased productivity, and production at our bauxite and copper assets was also higher."

The Anglo-Australian miner maintained its iron ore production guidance for this year of 330 million to 340 million tonnes.

Rio Tinto also held its 2018 copper guidance, but said its aluminum forecast of 3.5 to 3.7 million tonnes would be adjusted after it completed the sale of some smelters. Aluminum guidance could also be adjusted following U.S. sanctions, it said.

Rio Tinto said last Friday that it will declare force majeure on certain customer contracts after U.S. sanctions on its partner Russian aluminum producer Rusal. Rusal owns a 20 percent stake in Rio's Queensland Alumina Ltd.

Rio could still be a big beneficiary of the U.S. sanctions on Rusal as it is a major supplier of aluminum to the United States from its Canadian smelters.

For the March quarter, aluminum production fell 5 percent from a year ago to 846,000 tonnes, while copper output jumped 65 per cent to 139,300 tonnes.

Iron ore output was down 11 per cent from the fourth quarter of 2017, while copper production was down six percent.