Highlight
•
Health, safety and well-being remains our top priority. Our all injury
frequency rate (AIFR) of 0.35 improved versus the first quarter of 2020
(0.40). However, we recognise there is no room for complacency and
continue to focus on providing strong support for our employees,
contractors and host communities, while maintaining critical COVID-19
controls.
•
Pilbara iron ore shipments of 77.8 million tonnes (100% basis) were 7%
higher than the first quarter of 2020. Production of 76.4 million tonnes
(100% basis) was 2% lower, driven by above average wet weather in the
mines through February and fixed plant reliability. Labour resource
availability and weather challenges disrupted maintenance. Tropical
Cyclone Seroja impacted mine and port operations in April. Full year
iron ore guidance remains unchanged.
•
Production of pellets and concentrate at Iron Ore Company of Canada
(IOC) was 8% lower than 2020 due to the impacts of weather, loading unit
availability on mine feed and reduced concentrator mill availability.
There was a fire at one of the two reclaimers at the port on 31 March.
Full year production guidance remains unchanged.
Production
|
Q1
2021 |
vs
Q1 2020 |
vs
Q4 2020 |
Pilbara iron ore shipments (100% basis) (Mt) |
77.8 |
7% |
-12% |
Pilbara iron ore production (100% basis) (Mt) |
76.4 |
-2% |
-11% |
IOC
iron ore pellets and concentrate (Mt) |
2.3 |
-8% |
-14% |
Production guidance
|
2020 |
Q1
2021 |
2021 |
Actuals |
Actuals |
Unchanged |
Pilbara iron ore (shipments, 100% basis) (Mt) |
331 |
77.8 |
325
to 340 |
IOC
iron ore pellets and concentrate (Mt) |
10.4 |
2.3 |
10.5 to 12.0 |
Operating costs
Pilbara
iron ore 2021 unit cost guidance of $16.7-$17.7 per tonne remains
unchanged. Operating cost guidance is based on A$:US$ exchange rate of
0.77.
Pilbara operations
Pilbara
operations produced 76.4 million tonnes (Rio Tinto share 63.3 million
tonnes) in the first quarter, 2% lower than 2020 due to fixed plant
reliability and above average wet weather in the mines. In the first
quarter, labour resource availability and weather challenges disrupted
maintenance in the mine processing facilities which will be prioritised
for the rest of the year.
Full year
iron ore shipments guidance remains unchanged. It remains subject to
risks associated with tying in approximately 90 million tonnes of
replacement mine capacity at existing hubs in Robe Valley, West Angelas
and Western Turner Syncline Phase 2 as well as the start-up of
Gudai-Darri.
First
quarter shipments of 77.8 million tonnes (Rio Tinto share 64.6 million
tonnes) were 7% higher than 2020, due to solid operating performance and
sufficient inventory available in the quarter. We shipped 5.6 million
tonnes of SP10 during the first quarter.
Approximately 13% of 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 or on
the spot market. Approximately 29% of sales in the first quarter were
made on a free on board (FOB) basis, with the remainder sold including
freight.
On 19
February, we announced a new commercial freight shipping service
connecting Western Australia’s Pilbara region to Singapore. We expect
the service to reduce the lead-time for goods by six to ten days
compared with freight via Fremantle, and potentially provide
opportunities for local Pilbara businesses. Additionally, the new
service is expected to provide an annual saving of around three million
litres of diesel fuel by reducing road travel from Perth by more than
3.8 million kilometres.
China
Portside Trading
We continue
to ramp up our port sales in China, with 1.8 million tonnes of sales in
the first quarter. Since the commencement of our portside business we
have supplied more than 60 new steel mill customers, and we are present
at 12 ports in China. Our portside operation handles product from our
operations in the Pilbara and in Canada as well as third party product,
and provides blending and screening capabilities.
Rio
Tinto share of production (Million tonnes) |
Q1
2021 |
vs
Q1 2020 |
vs
Q4 2020 |
Pilbara Blend and SP10 Lump1 |
18.1 |
-2% |
-17% |
Pilbara Blend and SP10 Fines1 |
28.2 |
2% |
-9% |
Robe
Valley Lump |
1.3 |
-11% |
-4% |
Robe
Valley Fines |
2.2 |
-9% |
-16% |
Yandicoogina Fines (HIY) |
13.5 |
-4% |
-5% |
Total
Pilbara production |
63.3 |
-1% |
-11% |
Total
Pilbara production (100% basis) |
76.4 |
-2% |
-11% |
Rio
Tinto share of shipments (Million tonnes) |
Q1
2021 |
vs
Q1 2020 |
vs
Q4 2020 |
Pilbara Blend Lump |
12.8 |
-11% |
-21% |
Pilbara Blend Fines |
28.6 |
7% |
-19% |
Robe
Valley Lump |
1 |
-9% |
-18% |
Robe
Valley Fines |
2.4 |
-11% |
-22% |
Yandicoogina Fines (HIY) |
14.2 |
10% |
-6% |
SP10
Lump1 |
2.7 |
165% |
157% |
SP10
Fines1 |
2.9 |
168% |
65% |
Total
Pilbara shipments2 |
64.6 |
8% |
-12% |
Total
Pilbara shipments (100% basis)2 |
77.8 |
7% |
-12% |
Total
Pilbara Shipments (consolidated basis)2, 3 |
66.4 |
8% |
-12% |
1
SP10 includes other lower grade
products.
2
Shipments includes
material shipped
from the
Pilbara to
our portside trading
facility in
China which
may not
be sold
onwards by
the group
in the
same period.
3
While Rio
Tinto has
a 53% net
beneficial interest in
Robe River
Iron Associates,
it recognises
65% of
the assets,
liabilities, sales revenues
and expenses
in its
accounts (as
30% is held through
a 60%
owned subsidiary
and 35%
is held
through a
100% owned subsidiary).
The consolidated
basis sales
reported here
include Robe
River Iron
Associates on
a 65% basis to enable
comparison with revenue reported in the financial
statements. |