SYDNEY: Global miner Rio Tinto said on Tuesday it could ship up to an additional 10 million tons of iron ore in 2018 worth $780 million (SR2.925 billion) at today’s prices after reporting a 1 percent rise in 2017 shipments.
The slight lift in 2017 output to 330.1 million tons came as the average sales price for its ore jumped 20 percent over the year to $64.80, buoyed by strong demand from Chinese steelmakers.
The price rise helped the world’s no. 2 iron ore miner boost returns to shareholders after a bumper first-half profit. Rio is due to report its 2017 full-year profit on February 7, with forecasts centered around $8.5 billion, up 85 percent.
Rio on Tuesday also stuck to a target of 330-340 million tons of iron ore from its new Silvergrass mine, which is ramping up operations in Australia’s Pilbara.
Silvergrass yielded about 2 million tons in 2017 and at peak production should yield 10 million tons a year, according to the company.
The iron ore price stood at $78.05 per ton on Jan. 12, according to Metal Bulletin. However, uncertainty over Chinese demand has led to forecasts for prices to fall as the year progresses, which could cut Rio’s take from any additional sales.
“The business performed well in the fourth quarter, and we finished the year in line with guidance across all major products,” Chief Executive Jean-Sebastien Jacques said in a statement.
Fourth-quarter iron ore shipments rose 3 percent to 90 million tons from the same period a year ago and 5 percent against the previous quarter.
The last quarter is typically the strongest as miners boost exports ahead of the first quarter, a high cyclone-risk period in Australia.
In other commodities, Rio Tinto stuck to a 2018 target of 510,000-610,000 tons of mined copper and 225,000-265,000 tons of refined copper. Aluminum production will reach 3.5-3.7 million tons.
For 2017, aluminum production eased 1 percent and mined copper output fell 9 percent.
The mined copper decline followed a 43-day strike at Rio’s Escondida mine in Chile in the first quarter and a 22 percent drop in output from the Oyu Tolgoi open pit mine in Mongolia as sources of higher grade ore were fully depleted.
The slippage in copper output should be more than offset by better copper prices, which have climbed 25 percent in the past year, said Shaw and Parners analyst Peter O’Connor.
Separately on Tuesday, Rio Tinto subsidiary Turquoise Hill Resources said it was being asked to pay $155 million in tax arrears by Mongolia after an audit of Oyu Tolgoi’s tax payments between 2013 and 2015.
Turquoise Hill, which is 51 percent owned by Rio Tinto, said it was of the “firm view” the mine had paid all required taxes and charges. Turquoise Hill holds 66 percent of Oyu Tolgoi.
Rio Tinto targets modest hike in 2018 iron ore shipments
Rio Tinto targets modest hike in 2018 iron ore shipments
Airlines across Middle East, Asia extend flight suspensions for 3rd straight day
RIYADH: Airlines and airport operators across the Middle East extended flight suspensions for a third consecutive day after US and Israeli strikes on Iran triggered widespread airspace closures, disrupting global travel routes.
Major Gulf hubs halted operations as authorities kept sections of regional airspace closed, forcing carriers to cancel thousands of flights and reroute long-haul services linking Europe, Asia and Australia.
This comes as flight cancellations affected seven airports across the Middle East on March 1, including Dubai and Abu Dhabi in the UAE, Doha in Qatar, and Manama in Bahrain.
Emirates said in a statement that, due to multiple regional airspace closures, it has temporarily suspended all operations to and from Dubai until 3:00 p.m. UAE time on March 3.
“The situation remains dynamic and is assessed continuously. We urge all customers to review the latest operational updates on emirates.com and check their email for any notifications about changes or cancellations to their flights before travelling to the airport,” the airline said.
Hamad International Airport said flights remain suspended and will resume once the Civil Aviation Authority announces the reopening of Qatari airspace. The airport advised passengers not to travel to the airport and to contact their airlines for updates.
The closures disrupted key hub airports in Dubai, Abu Dhabi and Doha. Emirates, Qatar Airways and Etihad — which operate from these hubs — normally handle around 90,000 passengers daily, with even more traveling to other Middle Eastern destinations, according to aviation analytics firm Cirium.
The disruption has compounded volatility in airline shares amid concerns over higher fuel costs and prolonged operational uncertainty.
Ipek Ozkardeskaya, senior analyst at Swissquote, said: “The weekend was marked by tensions between the US, Israel, and Iran, leading to hundreds of explosions targeting broader Middle East countries as well, including the UAE, Saudi Arabia, Qatar, Bahrain and Kuwait.”
He added: “The flare-up was predictable; markets had been preparing for weeks as US warships advanced to the region preceding the explosions.”
Asian airlines shares plunge
Asian airline stocks slid on March 2, with Hong Kong’s Cathay Pacific, Australia’s Qantas, Singapore Airlines, and Japan Airlines falling more than 5 percent after the escalation disrupted travel flows and heightened concerns over fuel prices, Asharq Bloomberg reported.
Qantas shares dropped as much as 10.4 percent to a 10-month low at the Australian market open before trimming losses to trade down nearly 6 percent.
Other carriers, including Japan Airlines, Air China and Malaysia Airlines, also declined.
Cathay Pacific canceled all flights to the Middle East, including passenger services to Dubai and Riyadh, until further notice.
Singapore Airlines suspended flights to and from Dubai until March 7, while Japan Airlines halted services between Tokyo and Doha for the time being.
Flight data provider VariFlight said Chinese airlines have canceled 26.5 percent of their services to and from the Middle East scheduled between March 2 and 8.
