Rio Tinto’s third-quarter results for 2024 revealed mixed performance across key commodities. Copper and aluminium production faced setbacks, while bauxite output saw significant growth. Despite challenges, the mining giant remains on track to meet its annual targets with strong performances in key areas like bauxite and refined copper production.
Copper Production Faces Setbacks, But Refined Copper Sees Gains
Rio Tinto’s mined copper production in Q3 2024 decreased by 1% year-on-year, amounting to 167,800 tonnes. This drop was largely attributed to a severe 44% decline at the Kennecott mine in the United States. Ground movement issues at Kennecott restricted access to higher-quality ore, forcing the mine to rely on lower-grade material, impacting overall production. However, other key assets performed well. The Escondida mine in Chile saw a 15% rise in output due to improved ore grades, while the Oyu Tolgoi mine in Mongolia delivered a 19% boost driven by increased operational efficiency and higher production rates.
Despite these quarterly challenges, Rio Tinto’s overall copper production for the first nine months of 2024 showed growth, increasing by 8% year-on-year to 494,700 tonnes. A bright spot for the company was in its refined copper production, which surged by 59% in Q3, reaching 54,300 tonnes. This increase was driven primarily by a 129% rise in refined copper output from the Kennecott smelter, following a significant rebuild of the smelter and refinery. However, this was partially offset by a 24% drop in Escondida’s refined copper output, which was due to lower ore grades in the region. For the first nine months, Rio Tinto’s refined copper production increased by 39%, reaching a total of 179,600 tonnes.
Aluminium Production Drops Amid Operational Hurdles
Rio Tinto’s aluminium production also saw a decline in Q3 2024, dropping 2% compared to the same period in 2023. The company produced 809,000 tonnes of primary aluminium, marking a slight decrease from both the year-ago period and the previous quarter. The reduction in output was partly driven by operational issues at its New Zealand Aluminium Smelters (NZAS) subsidiary. The planned 600 MW renewable hydrogen and ammonia project, a key part of NZAS’s future energy transition, was delayed due to economic and logistical hurdles. As a result, the company had to adjust its production plans.
Despite these setbacks, Rio Tinto’s aluminium production for the first nine months of 2024 remained stable, with a modest 1% increase to 2.46 million tonnes. The company is optimistic that production at its Tiwai Peninsula smelter in New Zealand will ramp up by mid-2025, following a resolution of the energy challenges faced at NZAS.
Bauxite Production Up 8% Year-on-Year
On a more positive note, Rio Tinto’s bauxite production saw an 8% increase in Q3 2024, totalling 15.1 million tonnes. This growth was driven by enhanced efficiency at the company’s Amrun mine in Weipa, Australia. The implementation of Rio Tinto’s Safe Production System, which uses data-driven insights to optimize maintenance schedules and prevent bottlenecks, played a key role in boosting output. For the year-to-date period, total bauxite production rose by 9% year-on-year, amounting to 43.2 million tonnes, reflecting a strong performance in this critical segment.
Bauxite is a key raw material for aluminium production, and Rio Tinto’s ability to increase its bauxite output will be crucial for the company’s long-term aluminium production plans, particularly as it looks to meet the growing demand for aluminium in sectors like electric vehicles (EVs) and renewable energy infrastructure.
Stable 2024 Outlook Despite Quarterly Challenges
Looking forward, Rio Tinto has maintained a stable outlook for the remainder of 2024. The company expects to produce between 660,000 and 720,000 tonnes of mined copper and between 230,000 and 260,000 tonnes of refined copper in the fourth quarter. This forecast reflects Rio Tinto’s confidence in its ability to meet annual production goals despite the challenges experienced in Q3. With strong performances in key areas like bauxite and refined copper, the company is well-positioned to close the year on a positive note.
In addition, Rio Tinto continues to focus on its sustainability goals and is making strategic investments to support the long-term future of its operations. Notably, the company is working with the Queensland state government in Australia to transition its Boyne smelter to renewable energy, ensuring a more sustainable and resilient future for its aluminium production.
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