June 7, 2011 / 9:44 AM / 6 years ago

UPDATE 1-Rio Tinto says on track to produce over 240 mln T iron ore in 2011

 * Rio Tinto sees hefty growth in iron ore
 * Plans to spend $1.146 billion in sector over next five
years
 * Boost in output seen this year despite weakened Q1

 (Adds details, background)	
 SYDNEY, June 7 (Reuters) - World No. 2 iron ore producer Rio
Tinto  said on Tuesday it was on track to
produce over 240 million tonnes of the steelmaking raw material
this year versus 239 million tonnes in 2010 and outlined further
growth.	
Rio Tinto, like most global mining houses sees much of its
future in supplying iron ore to the swelling number of
steelmaking operations in Asia.	
 It's biggest customers for ore are China and Japan.	
 Over the next five years, the company has earmarked more
than $1.1 billion to expand its iron ore mines.    
 Iron ore accounted for 73 percent of Rio Tinto's 2010
earnings, compared to a 40 percent contribution for No. 3
producer BHP Billiton's  first-half earnings.	
 	
 Only Brazil's Vale mines more iron ore each year
than Rio Tinto, which mines the majority of its ore in the
Pilbara region of Australia and also in Canada.	
 The production forecast for all of Rio Tinto's iron ore
operations comes as de-bottlenecking work takes hold at its
Dampier port in the Pilbara, adding an additional 5 million
tonnes a year to overall annual capacity, which currently stands
at 225 million tonnes, the company said.	
By mid-2013, Rio Tinto forecast output would climb to 283
million tonnes, then 333 million two years after that.	
 "Further growth options to 433 million tonnes per year are
very clear, with early studies underway," the company said in a
slide presentation posted on the Australian Stock Exchange.	
 Iron ore  .IO62-CNI=SI sells for about $170 a tonne and
hit record high prices of around $190 a tonne in February, well
above the average cost of production for miners.  	
 Rio Tinto said the increase in output this year would be
achieved despite a slow first quarter, when production was
reduced by severe weather that led to a train derailment in the
Pilbara.	
 	
	
 (Reporting by James Regan; Editing by Ed Lane)	
 

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