LONDON-LISTED miner Rio Tinto yesterday reported almost flat iron ore production growth for the fourth quarter, weaker than some market expectations amid concerns that Chinese demand is softening.
The company reported a three per cent rise in output between the third and fourth quarters of 2011, down from growth of nearly double that at the end of 2010.
That was much less than some commodities analysts had expected, with one analyst having tipped a rise of 20 per cent as Rio Tinto continues to expand its iron ore operations, which are based mostly in the north west of Australia.
The results were issued on the same day that Chinese data showed the world’s second-biggest economy grew at its weakest pace in two years in the latest quarter and it appeared headed for an even sharper slowdown in the coming months.
However, China’s growth came in slightly higher than some had expected, helping buoy Rinto’s shares by more than two per cent.
Based on analysts’ forecasts, Rio Tinto is expected to report full-year 2011 earnings before interest and tax of around $23bn (£14.9bn), up from $21.1bn in 2010.
Despite fears over China, both Rio and rival BHP Billiton are pinning their hopes of growth on the growing economic power. China is Rio’s biggest market.
Meanwhile Australia’s third-largest iron ore producer, Fortescue Metals Group, reported a 19 per cent jump in quarterly shipments from the previous quarter to 14.8m tonnes as it also expanded.