Financial news wires are reporting that the expert mining analysts at Macquarie Group Ltd (ASX: MQG) expect the Rio Tinto Limited (ASX: RIO) share price could hit $114 in 2019. Rio Tinto shares are already up around 34% over just the past year to $107.14 today largely on the back of the unexpected rise of the iron ore price from US$67 per tonne at the start of 2019 to US$121 per tonne today according to data provider Market Index.Â
The iron ore price rise is largely due to supply constraints out of Brazil after a tragic mining accident killed more than 300 people in the world's second largest producer of iron ore behind Australia.Â
Rio Tinto has also benefited from the falling Australian dollar as most of the WA miner's operating costs are incurred in Australian dollars before it sell its product in US dollars. This provides a big uplift to margins and profits meaning the miner can pay out bigger dividends.Â
On June 19 2019 Rio was forced to revise down 2019 production to between 320 million to 330 million tonnes of iron ore in a result it blamed on "operational challenges" and a higher proportion of low grade product that originally expected.Â
