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Rio Tinto sees on-quarter shipments fall due to weather

World number 2 iron ore producer Rio Tinto posted an 8 percent drop in first-quarter shipments compared with the previous quarter owing to weather-related disruptions in Australia and Canada.

However, production was still up 16 percent on the first quarter a year ago as the world's second-biggest iron ore producer behind Brazil's Vale, ramps up production at its Australian mines.

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Rio Tinto said it was on track to meet its target of mining ore at the rate of 290 million tonnes a year and maintained its 2014 production target of 295 million tonnes.

"Production in the first quarter was below fourth quarter levels due to disruptions caused by seasonal weather patterns," Rio Tinto said in its first quarter operations report.

Rio Tinto Iron Ore Parker Point loading facility reclaimer is seen as part of the mining activities of British-Australian mining and resources company Rio Tinto Iron Ore, at Dampier in Western Australia.
Aaron Bunch | Getty Images News | Getty Images
Rio Tinto Iron Ore Parker Point loading facility reclaimer is seen as part of the mining activities of British-Australian mining and resources company Rio Tinto Iron Ore, at Dampier in Western Australia.

Rio's Iron Ore of Canada division was hit by a colder-than-average winter, which disrupted mining in Labrador over the quarter, while port closures due a cyclone late last year reduced shipments in Australia, the company said.

Overall iron ore shipments in the first quarter came in at 66.7 million tonnes.

Rio Tinto said it would draw on its Australian stocks of iron ore to enable it to increase shipments ahead of production, with around 5 million tonnes of inventory drawdown expected in 2014.

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Production of 295 million tonnes in 2014 would keep Rio Tinto ahead of rivals BHP Billiton and Fortescue Metals Group, which report quarterly data on Wednesday.

Iron ore of Canada (IOC) is 59 percent owned by Rio Tinto, 26 percent by Mitsubishi and 15 percent by Labrador Iron Ore Royalty. Rio Tinto put its stake in IOC up for sale about a year ago but offers came in well below the mining group's target of about $3.5 to $4 billion, sources said.

Outside of iron ore, Rio Tinto said mined copper production benefited from richer ore grades at the Kennecott Utah business and output from the recently-opened Oyu Tologoi mine in Mongolia.

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"This more than offset the elimination of production from copper assets divested in 2013," the company said.

Mined copper production was up 17 percent in the first quarter versus a year ago, but fell 6 percent from the previous quarter, it said.

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