Looks like Rio Tinto is the star of Earnings Season so far. The miner released encouraging production figures, with its iron ore output beat its own estimates in rising 4% in 2012 to 253 million tonnes. Can’t say I saw that coming, given the crises in China and Australia during the summer months.
Looks like it’s China that’s now picking up the slack, accounting for the surge in commodity prices in during the last quarter. The pickup has been staggering, it’s been around about an 80% increase in iron ore prices since September. With signs of recovery in the Chinese economy, as shown by finally expanding manufacturing PMIs, it looks as though it’s all systems go and I wouldn’t be spread betting against further gains.
Rio will be happy too – as this Chinese demand will surely rekindle mining investment. In other figures released by Rio, copper production went up 6%, but aluminium production went down 10%. Within the figures, mined copper production for 2012 rose 6% while thermal coal output was up 16% for the year. However, hard coking coal production fell 9%, and aluminium production was down 10%. I’ve long been hesitant to take a position on copper, but Rio – as one of the flagship miners – looks like it’s in for a promising 2013.