Rio Tinto output setback

The mining and resources group, Rio Tinto, achieved a near-record iron ore output in the third quarter but output was down across a whole range of other minerals and metals.

The iron ore production of 35.7m tonnes was up 2% compared with the previous year. The company said the programme to improve output at Pilbara was on target and planning was in progress for a further expansion to 320m tonnes per year capacity by 2012-2014.

The group, which is in the process of acquiring Alcan, the Canadian aluminium producer for $44 billion, was one of the worse performers today on the FTSE 100 after a production report issued today prompted a 2.8% decline in the share price.

The group said its US thermal coal production was flat year-on-year. Coal types fell 24% following logistical struggles and Australian coking coal output declined 10%. Coking coal output is being delayed due to the shortage of port capacity in Queensland, this is stopping the company from taking advantage of high market prices.

The volume of mined copper declined 6% whereas refined copper output was up 30%, primarily due to maintenance work on a US smelter in the third quarter 2006. Mined gold increased by a strong 35% on better grades. However, diamond output was down on low feed grades at the Argyle workings.

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