The
worlds second biggest iron ore producer continued with its plans to increase
production throughout late 2012 and inter the first half of 2013. The recent
uncertainty in the industry has given many of the smaller mining companies
reason to want to scale back operations to combat higher costs and falling
prices. The Australian metals industry has remained highly cyclical, but thanks
to the long term growth of the Asia Pacific market and long term plans of the
big minors we are now experiencing the boom in production that follows the boom
in growth.
Rio’s
reported ore production increased 5 percent in the third quarter of 2012 as
mines in Western Australia’s Pilbara region achieved a quarterly record of 63
million tonnes. Analysts are predicting a massive US$4.5b in interim earnings
from iron ore in the six months ended June, overcoming predicted losses in
other commodities.
Cost
cutting remains a focus for all the minors. Once the global growth begins to
accelerate demand prices will pick up again. Production will remain the focus
for the miner.
Jenny
Purdie, Rio Tinto's Global Practice Leader, Technology Delivery, Innovation recently
stated: "In a volatile post-GFC environment, businesses are all looking
for ways to be more efficient, effective and competitive to be successful.
"Rio
Tinto is no different. Mining is
cyclical and like all miners we're operating in a challenging environment of
lower commodity prices, a high Australian dollar and high input costs,"
she said.
Productivity
remains the buzz word for 2013 and the company plans to expand production
capacity in the Pilbara region to 283 million tonnes annually by the end of
2013 and to more than 350 million tonnes by mid-2015.
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