Rio Tinto flags possible supply chain risks, posts higher Q1 iron-ore sales
Miner Rio Tinto warned on April 21 of limited visibility on the effects of the Middle East war on its supply chains in the second half of the 2026 financial year, but stronger production from its Pilbara operations boosted first-quarter iron ore sales in the meantime.
Shares of the world's biggest iron-ore producer rose by 1% to A$174.27 apiece, while the broader benchmark index was 0.2% higher.
"To date on the supply-side, the direct impacts on our operations have been limited, while our commodity prices have responded favourably," Rio said in a statement, adding that it had contingency plans in place for the ongoing conflict.
The Anglo-Australian miner, which turned down overtures from Glencore earlier this year to form the world's largest mining company, said higher diesel prices had raised costs, but its cost position remained resilient, supported by its scale and global supply-chain leverage.
"In the second half, we see jet fuel and diesel shortages as the key risk to operations," said brokerage CLSA Australia resources and energy research head Baden Moore.
He added that these shortages not only impact the operation of diesel equipment but may also limit the movement of goods and services as well as personnel to sites. Fortunately, shipping shortages are not anticipated at this stage.
Rio Tinto sold 72.4-million tons of iron-ore from its Pilbara operations in the three months ended March 31, up 2.4% from a year earlier but below the Visible Alpha consensus estimate of 74.6-million tons.
Rio said its Pilbara operations posted their second-highest first-quarter production since 2018, reporting a 13% rise on productivity gains and fewer weather disruptions.
It maintained its 2026 Pilbara iron ore sales forecast at between 323-million and 338-million tons.
Among other revenue-generating commodities, mined copper output for the quarter came in at 229 000 t, which was higher than the 210 000 t reported a year earlier, driven by stronger production at Oyu Tolgoi.
Meanwhile, Rio Tinto's bauxite production was 11% lower year-on-year at 13.3-million tonnes in the first quarter, while lithium carbonate equivalent production reached 12 700 t. The group's copper production increased by 9% year-on-year to 229 000 t in the reporting quarter.
