By Rhiannon Hoyle 
 

Rio Tinto PLC on Tuesday reported a fall in full-year production across all the commodities it produces, including iron ore, copper and aluminum. Here are some remarks from its fourth-quarter operational report.

 

On commodity markets:

"Market dynamics were broadly positive throughout 2021 for most commodities, lifting a number of prices to cyclical highs. Fiscal and monetary support and successful vaccine campaigns were key contributors to strong demand growth that ultimately stretched global supply chains to their limits and created challenging conditions for many of the world's producers. We are encouraged by growth prospects in the coming year but remain vigilant in relation to potential disruption from new Covid-19 variants and geopolitical tensions."

 

On Mongolia copper operations:

"Mined copper production from the open pit was 9% higher than 2020 with improved performance, temporary increase in grades, and increased mill feed following geotechnical issues in the first half, partly offset by lower staffing levels due to Covid-19. In the fourth quarter, stringent Chinese border restrictions continued due to increased cases of Covid-19 in Mongolia. We continue to work closely with the Mongolian and Chinese authorities and our customers to manage the risk of supply chain disruptions. Cross-border concentrate shipments into China have resumed with some measures in place to transport greater volumes in a safe and efficient manner, however uncertainty continues to exist with the rate of Covid-19 cases in Mongolia. The force majeure declared on shipments from March 30 remains in place."

 

On Australian iron-ore operations:

"Pilbara operations produced 319.7 million tons (Rio Tinto share 266.8 million tons) in 2021, 4% lower than 2020. This was due to above average rainfall in the first half of the year, cultural heritage management and delays in growth and brownfield mine replacement tie-in projects. Ongoing Covid-19 restrictions and a tight labor market have further impacted our ability to access experienced contractors and particular skill sets. Production from the new greenfields mine at Gudai-Darri and brownfield mine replacement project at Robe Valley, was delayed due to Covid-19 impact on labor availability and an inability to conduct pre-delivery quality assurance and control at international steel manufacturers due to limitations on travel."

 

On China's steel market:

"China's crude steel production and iron ore imports were stable year on year, with steel production exceeding 1 billion [metric] tons for a second time, despite numerous steel mill operating restrictions and a slowing property sector. Steel consumption and production rates in China decelerated significantly during the fourth quarter of 2021 however, iron ore seaborne supply improved, resulting in a circa 30% decline in iron ore prices in the fourth quarter versus the prior quarter. Meanwhile, the steel and iron ore demand recovery in developed and other emerging economies maintained its momentum and global crude steel production grew by an estimated 6% year on year--by one of its largest absolute annual increments in history--to a record total of almost 2 billion tons in 2021."

 

Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com

 

(END) Dow Jones Newswires

January 17, 2022 17:54 ET (22:54 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.
Rio Tinto (NYSE:RIO)
Historical Stock Chart
From Apr 2022 to May 2022 Click Here for more Rio Tinto Charts.
Rio Tinto (NYSE:RIO)
Historical Stock Chart
From May 2021 to May 2022 Click Here for more Rio Tinto Charts.