The Rio Tinto Ltd (ASX: RIO) share price is under pressure on Wednesday morning.
At the time of writing, the mining giant's shares are down 1% to $127.60.
This follows the release of the company's first-quarter production update.
Rio Tinto share price falls on quarterly update
For the three months ended 31 March, Rio Tinto had a reasonably disappointing quarter with production across all commodities falling compared to the previous quarter.
According to the release, iron ore production fell 11% quarter on quarter to 77.9Mt. This reflects planned ore depletion, predominantly at Yandicoogina, which was partially offset by productivity gains across other operations.
This led to Rio Tinto's iron ore shipments reducing 10% quarter on quarter to 78Mt.
Management advised that approximately 10% of Pilbara iron ore sales in the first quarter were priced by reference to the prior quarter's average index lagged by one month. The remainder was sold either on current quarter average, current month average, average of two months, forward month or on the spot market. The average iron ore price during the quarter was US$123 per dry metric tonne.
The miner's copper production fell 3% compared to the fourth quarter to 156k. This was driven largely by Kennecott mined copper production. While it was 7% higher than the first quarter of FY 2023, it was 32% lower than the previous quarter. This was primarily due to unplanned conveyor downtime. The good news is that the impacted conveyor is now fully operational again.
Elsewhere, Rio Tinto's aluminium production fell 2% quarter on quarter to 826kt and bauxite production was down 11% to 13.4Mt.
How does this compare to expectations?
As I covered here earlier this week, the market was expecting iron ore shipments of 79.6Mt, aluminium production of 824kt, and copper production of 171kt.
This means that it has fallen short on shipments and copper production, but narrowly beaten aluminium production expectations.
This may explain why the Rio Tinto share price is falling today.
Guidance reaffirmed
Rio Tinto's chief executive, Jakob Stausholm, appeared to be relatively pleased with the quarter and has reaffirmed all FY 2024 guidance. He said:
We delivered stable operating results in the first quarter, including improvements at our bauxite and aluminium businesses, as we navigated seasonal challenges across our global operations. Our full year guidance is unchanged across all our products. We remained focused on growth in energy-transition materials, with the ramp-up at Oyu Tolgoi underground, the first full quarter of recycled aluminium production from Matalco and further progress at Simandou, our high grade iron ore project in Guinea.
Stausholm also highlights the steps the miner is taking to decarbonise its operations. He adds:
Action to decarbonise our operations continues, with power purchase agreements signed marking a significant step towards a competitive renewable energy solution for our Gladstone operations – the single largest lever towards our 2030 emissions goal. We also joined with BHP and BlueScope to investigate the development of Australia's first electric smelting furnace pilot plant, progressing our work on steel decarbonisation. We continue to pursue our long-term strategy, and have a clear pathway to deliver operational excellence, while investing in profitable growth and delivering attractive shareholder returns.
