Australia: Rio Tinto iron ore shipments down 5% in Q3, CY'20 guidance unchanged

Rio Tinto's Pilbara iron ore shipments were recorded at 82.1 mn t for Q3 CY'20, down 5% as against 86.7 mn t in Q2 CY'20. The shipments fell due to planned maintenance activity at ports. On am yearly basis too, shipments depicted a 5% drop in the third quarter of the year (Q3 CY'20) against 86.1 mn t in Q3 CY19.

Iron ore production up by 4% in Q3 CY20
Rio Tinto's Pilbara depicted a 4% rise on a quarterly basis in iron ore production to 86.4 mn t in Q3 CY'20 as against 83.2 mn t in Q2 CY'20. For the quarter Q3 CY'20, the production fell slightly as compared to 87.3 mn t in Q3 CY'19.

IOC pellet production drops 15% in Q3 CY'20
IOC iron ore pellet & concentrate production in Q3 CY'20 recorded at 2.3 mn t, down 15% compared to Q2 CY20 at 2.7 mn t. The drop is due to annual maintenance shutdown deferred from June to September as a result of COVID-19 travel restrictions. Also, weather related power failure and mechanical issues affected the output.

On a yearly basis too, the production dropped by 21% as compared to 2.9 mn t in Q3 CY19.

The miner at IOC continues the product mix optimization with shift to higher pellet production to meet the recovery in demand from Europe. IOC is now operating five out of six lines in its pellet plant, with plans to bring back the sixth line before the end of CY'20.

Key updates:

1. Rio Tinto 2020 Pilbara iron ore shipment guidance remains unchanged at 324-334 mn t.

2. At IOC, the iron ore pellet and concentrate production guidance for 2020 remains intact at 10.5-12 mn t.

3. Pilbara iron ore unit cost guidance for 2020 is unchanged at $14-15/t.

4. In September the miner signed a memorandum of understanding with Dalian Port Company Limited to establish the first iron ore blending operation in a bonded area. This partnership allows offering a blended product to customers across Asia, using Dalian Port as a transshipment hub.