Rio Tinto Ltd (ASX: RIO) shares are in spotlight today after the mining giant released its third-quarter production update.
There was plenty to like in the announcement, particularly the progress being made across its iron ore and copper operations.
But does the update strengthen the case for buying Rio Tinto shares? Here's what I think.
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A solid quarter for Rio Tinto
One of the highlights was the continued strength of Rio Tinto's iron ore business.
The company reported global iron ore sales of 90.8 million tonnes during the quarter, an increase of 3% on the prior corresponding period. Its Pilbara operations also performed well, with sales increasing 2% to 85.7 million tonnes.
I think that is encouraging because iron ore remains an important source of earnings and cash flow for the company.
Strong operational performance here can help Rio Tinto fund its investments in other commodities, particularly copper and lithium.
There was also positive progress at Simandou, the enormous iron ore development in Guinea.
The project reached an annualised production rate of approximately 10 million tonnes during the quarter and remains on track to reach a 60 million tonne annualised rate in the second half of 2028.
That gives Rio Tinto another avenue for production growth over the next few years.
Copper is becoming increasingly important
The other part of the update that caught my attention was the performance of Oyu Tolgoi in Mongolia.
Copper production at the operation increased 27% compared with the same quarter last year, reflecting the ongoing ramp-up of its underground mine.
This helped offset weaker production elsewhere in Rio Tinto's copper portfolio, leaving total copper output broadly unchanged for the quarter.
I think Oyu Tolgoi could become an increasingly valuable part of the business. Copper demand is expected to benefit from investments in electricity networks, renewable energy, electric vehicles, and data centres. And Rio Tinto is positioning itself to meet some of that demand.
The company expects Oyu Tolgoi to produce around 500,000 tonnes of copper annually between 2028 and 2036, giving it a substantial production base for the coming decade.
For me, that is one of the strongest reasons to consider owning Rio Tinto shares for the long term.
What else stood out?
I was also encouraged by management's continued focus on improving productivity.
Rio Tinto remains on track to achieve an annualised productivity benefit of $1.8 billion by the end of 2026.
It has also announced more than $2 billion of capital release initiatives this year as part of a broader programme to free up funds from its portfolio.
I think improving efficiency and making better use of capital could be valuable as Rio Tinto continues investing in growth.
Foolish takeaway
I think Rio Tinto's latest update gives investors more reasons to be positive about its future.
The company is delivering solid operational performance while making progress on projects that could support earnings growth well beyond 2026.
I would be happy buying Rio Tinto shares for the long term, particularly with its copper business set to become increasingly important over the coming years.
