Source: Mining weekly

Despite the volatile market and lags in demand, Rio Tinto set new quarterly records for iron-ore sales and coking coal production. The company will continue to produce these materials at full production capacity. As for copper, the quality of copper produced at its Escondida site in Chile has steadily fallen, leaving greater opportunities for Mongolia's extensive Oyu Tolgoi project.

Global iron production reached 170 million tons, up 3 percent over the same period last year. Rio will continue to operate at full production at its Pilbara site in Australia and even plans to expand its operations.

Rio reported that hard coking coal production set a new quarterly record at 2.77 million tons, 14 percent above the third quarter of 2010, and recovered strongly from severe floods earlier this year. Semi-soft coking coal production was 57 percent higher than the corresponding quarter of 2010 at 733,000 tons, primarily owing to the ongoing expansion at Hunter Valley operations, while thermal coal production was three percent lower than the third quarter of 2010 and four percent lower than the second quarter, reaching only 4.5 million tons. Rio said that its share of Australian hard coking, semi-soft, and thermal coal production could reach eight million tons and 18 million tons respectively for the full calendar year. Coking coal, for steel production, is a major export of Mongolia, chiefly sold to China.

Meanwhile in Mongolia, Rio has raised its stake in Ivanhoe Mines to 49 percent. Rio and Ivanhoe Mines are developing the Oyu Tolgoi copper and gold project, expected to produce more than 1.2 billion pounds of copper and 650 ounces of gold a year in the first ten years of operation. The mine would produce around 1.7 billion pounds of copper and one-million ounces of gold at its peak in year seven. The first openpit phase is planned for mid-2012 with underground production two years later.
Lower grades of quality produced at the Escondida and Kennecott Utah Copper mines have contributed to production losses. At the Escondida site in Chile, third-quarter mined copper production decreased 39 percent compared last year to 44,700 tons due to a combinations poorer copper grades and work stoppages which halted operations for 15 years.