Rio Tinto produced 319.7 million tonnes of iron ore in Pilbara 2021, 4%
lower than 2020, setting 2022 production guidance at 320 to 335 million
tonnes. Full
iron ore part is shown below.
Pilbara operations
2021 shipments of 321.6 million tonnes (Rio Tinto share 267.9 million
tonnes) were 3% lower than 2020. Shipments included 36.6 million tonnes
of SP10 products. There was 8.8 million tonnes of Pilbara product
retained as working capital at China portside (1.7 million tonnes in
2020). SP10 products comprised a higher share of shipments in the fourth
quarter as a result of delays in growth and brownfield mine replacement
tie- in projects. As those mines ramp-up through the first half of 2022,
we will see SP10 gradually decrease and return to levels around 6% of
shipments in the medium term.
Pilbara operations produced 319.7 million tonnes (Rio Tinto share 266.8
million tonnes) in 2021, 4% lower than 2020. This was due to above
average rainfall in the first half of the year, cultural heritage
management and delays in growth and brownfield mine replacement tie-in
projects. Ongoing COVID-19 restrictions and a tight labour market have
further impacted our ability to access experienced contractors and
particular skill sets.
Production from the new greenfields mine at Gudai-Darri and brownfield
mine replacement project at Robe Valley, was delayed due to COVID-19
impact on labour availability and an inability to conduct pre-delivery
quality assurance and control at international steel manufacturers due
to limitations on travel. First ore from Gudai-Darri was railed in
December from the modular crushing and screening plant installed to
supplement production and mitigate commissioning delays. Robe Valley
production was significantly impacted by the Mesa A wet plant
commissioning delays.
Approximately 11% of sales in 2021 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 28% of sales in the fourth quarter were made on a
free on board (FOB) basis, with the remainder sold including freight.
Achieved realised pricing in 2021 was $132.3 per wet metric tonne on an
FOB basis (equivalent to $143.8 per dry metric tonne, at 8% moisture
assumption). This compares to the monthly average Platts index for 62%
fines converted to an FOB basis of $146.9 per dry metric tonne. In 2020,
average realised pricing was $91.0 per wet metric tonne ($98.9 dry
metric tonne).
China Portside Trading
We continue to increase our iron ore portside sales in China, with 5.1
million tonnes of sales in the fourth quarter of 2021 (1.8 million
tonnes in the fourth quarter of 2020), leading to a total of 14.0
million tonnes in 2021 (5.5 million tonnes in 2020). We experienced
increased inventory levels at the port due to higher volumes of SP10 and
constrained availability of high grade blending stocks in the fourth
quarter.
Our portside operation handles product from the Pilbara and Canada as
well as third party product, and provides blending and screening
capabilities. Approximately 81% of portside sales in 2021 were either
blended or screened in Chinese ports.
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