* Rio Tinto ups minerals output to feed Chinese demand
* Record iron ore output in 2013 set to rise further
* New Mongolia mine yielding more copper and gold
By James Regan
SYDNEY, Jan 16 Rio Tinto on
Thursday recorded big increases in iron ore and other minerals
it sells mainly to China, betting the country's massive economic
growth will provide a ready market for decades to come.
The world no. 2 iron ore miner behind Brazil's Vale
did not provide guidance on its 2014 production, but
is expected to reach an iron ore target of 290 million tonnes a
year by mid-2014 as it seeks to feed Chinese steel furnaces with
"We have set new records for iron ore production and
shipments as we ramp up our 290 expansion, as well as achieving
an impressive recovery in copper volumes and record annual
production for both bauxite and thermal coal," Chief Executive
Sam Walsh said in the company's fourth-quarter report.
Rio said production of iron ore, which makes up about 90
percent of its earnings following a surge in both demand and
prices, reached 266 million tonnes in 2013, slightly ahead of
guidance and up 5 percent on a year earlier.
A recent decline in steel prices in China has prompted some
mills to reduce production not lift it, cutting China's average
daily crude steel output to 1.961 million tonnes in late
December, the first time it has fallen below 2 million tonnes
since last February.
Analysts have questioned the need to flood the market with
more iron ore but mostly acknowledge that with the lowest
production costs of any miner, Rio Tinto could weather any
downturn in good shape.
Rio Tinto does not disclose production costs as a matter of
policy, although outside estimates have put average cash costs
as low as $26 per tonne, compared with a current price of
$129.60 , according to data compiler Steel Index.
Refined copper output from the Anglo-Australian company's
Kennecott Utah Copper unit rose 19 percent in 2013 over a year
earlier, while mined copper was up 29 percent.
A major wall collapse at subsidiary Kennecott's Bingham
Canyon copper mine last April shifted 150 million tonnes of
material and registered 2.4 on the Richter scale.
"The recovery of the open pit operations following the pit
wall slide continues to progress better than originally planned,
with completion of the new heavy vehicle access road achieved
ahead of schedule enabling further remediation and waste
movement to provide additional access to ore," Rio said.
Production also improved at its new Oyu Tolgoi mine in
Mongolia, with fourth-quarter mined copper and gold up 8 percent
and 18 percent respectively over the third quarter