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Rio Tinto's Q4'18 iron ore production, shipments slip YOY; copper output up 20%

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Rio Tinto's Q4'18 iron ore production, shipments slip YOY; copper output up 20%

Rio Tinto's fourth-quarter 2018 iron ore production and shipments slipped 1% and 3% year over year to 86.6 million tonnes and 87.4 million tonnes, respectively.

Full-year iron ore production and shipments from Pilbara, meanwhile, both climbed 2% to 337.8 million tonnes and 338.2 million tonnes, according to the company's Jan. 18 results.

Mined copper output in the fourth quarter surged 20% to 177,800 tonnes, primarily reflecting strong performance at the Escondida mine in Chile and increased production from Kennecott Utah Copper Corp. due largely to higher grades. Meanwhile, full-year mined copper output saw a 33% increase to 633,500 tonnes.

The company's quarterly production of bauxite fell 14% to 11.8 million tonnes. During the fourth quarter, commissioning works at the CBG mine in Guinea and the transition of operations from East Weipa to Amrun in Queensland, Australia, resulted in a short-term drop in production. Bauxite output in full-year 2018 slipped 1% to around 50.4 million tonnes.

Aluminum output in the quarter dropped 1% to 874,000 tonnes and full-year output fell 3% to 3.5 million tonnes, mainly due to ongoing labor disruptions at the at the Becancour smelter in Canada.

Iron ore pellets and concentrate output from the company's majority-owned Iron Ore Co. of Canada Inc.'s IOC operations in Labrador increased 4% on a yearly basis to about 2.8 million tonnes in the fourth quarter. However, the company's 2018 production dropped 20% to 9.0 million tonnes, due to a strike at the mine that significantly impacted second quarter production.

Diamond production from Rio Tinto's Argyle mine in Western Australia fell 48% to 3.2 million carats, while output from the company's 60%-owned Diavik mine in Canada's Northwest Territories rose 2% to 1.0 million carats in the quarter. In 2018, output from Argyle fell 18% to 14.1 million carats, while production from Diavik slipped 3% to 4.4 million carats.

In 2019, Rio Tinto expects its iron ore shipments from Pilbara to range between 338 million and 350 million tonnes. The company expects limited disruption to Robe River lump and fines shipments due to a recent fire at the Cape Lambert port, which is reflected in the guidance.

The mining major's expected share of iron ore pellets and concentrates production at IOC is expected to be between 11.3 million and 12.3 million tonnes. The company's aluminum production is seen raining between 3.2 million and 3.4 million tonnes, while alumina production is projected between 8.1 million and 8.4 million tonnes. Bauxite production in 2019 is expected to reach between 56 million and 59 million tonnes.

Rio Tinto's attributable mined copper output is estimated to be between 550,000 and 600,000 tonnes, with refined output estimated to be between 220,000 and 250,000 tonnes in 2019. In addition, the company expects to produce between 15 million and 17 million carats of diamonds this year.

The company completed asset disposals of US$8.6 billion in 2018, including the Grasberg copper mine in Indonesia and its remaining coal assets.

"With a firm 'value over volume' focus and disciplined allocation of capital, we will continue to progress our strategic objectives and to deliver superior returns to shareholders in the short, medium and long term," said Rio Tinto CEO Jean-Sebastien Jacques in a statement.