Rio Tinto Ltd (ASX: RIO) shares are rising on Thursday morning.
At the time of writing, the mining giant's shares are up 1.5% to $121.13.
This follows the release of the miner's fourth quarter update before the market open.
Rio Tinto shares rise on Q4 update
For the three months ended 31 December, Rio Tinto reported iron ore production of 86.5Mt and iron ore shipments of 85.7Mt. This represents increases of 3% and 1%, respectively, over the third quarter.
However, the latter was lower than the consensus estimate for iron ore shipments of 87.5Mt. This meant that for the full year, iron ore production and shipments were both down 1% year on year.
Rio Tinto advised that productivity improvements of 10 million tonnes did not fully offset depletion, predominantly at Yandicoogina and Paraburdoo, as it transitions to Western Range. The Safe Production System target of 5 million tonnes for 2024 was achieved and Gudai-Darri reached 50 million tonne per annum rates during 2024.
The company recorded an average realised iron ore price of US$97.4 per tonne for the year, down from US$108.4 per tonne in FY 2023.
Big year for copper
One big positive was that Rio Tinto's mined copper production jumped 21% quarter on quarter to 202kt during the fourth quarter. This was comfortably ahead of the consensus estimate of 182kt and took full year copper production to 697kt (up 13% year on year).
Management notes that this reflects the ramp up of Oyu Tolgoi underground and increased production from Escondida due to higher grades fed to the concentrator (0.99% versus 0.83%). This offset geotechnical challenges at Kennecott as instabilities in the pit wall impacted the mining sequence from the second quarter.
Rio Tinto recorded an average realised copper price of US$4.22 per pound for 2024, up from US$3.90 per pound in 2023.
Elsewhere bauxite production was up 2% for the quarter and 7% for the year, aluminium production rose 3% for the quarter and 1% for the year, and titanium dioxide slag production was down 11% for both the fourth quarter and full year.
Management commentary
Rio Tinto's chief executive, Jakob Stausholm, was pleased with the miner's performance. He said:
Our operating performance in 2024 was good, consistent with our ongoing commitment to strengthen the business as we execute our strategy to deliver profitable growth. The implementation of our Safe Production System has again contributed to greater consistency across key operations, including our iron ore assets in the Pilbara and our bauxite operations in Australia, where Amrun and Gove achieved record annual production.
We are making strong progress in delivering organic growth from our major projects. The Oyu Tolgoi underground copper mine in Mongolia continues to successfully ramp up, while the Simandou high-grade iron ore project in Guinea and our Western Range mine in the Pilbara are on schedule for first production this year.
FY 2025 guidance
Rio Tinto has reaffirmed its recently announced guidance for FY 2025 this morning. It is guiding to the following:
- Iron ore shipments of 323Mt to 338Mt
- Copper production of 780kt to 850kt
- Aluminium production of 3.25Mt to 3.45Mt
- Bauxite production of 57Mt to 59Mt
Rio Tinto shares are down 4% over the past 12 months.
