Rio Tinto Group said unplanned shutdowns at its Kennecott copper operation in the US weighed on second-quarter production of the metal, while its iron ore business rebounded from weather-related disruptions earlier in the year.
Copper output in the three months to June 30 slipped 7% from the previous quarter after problems at the Kennecott smelter in Utah forced the shutdown of a furnace that now needs to be rebuilt.
The mine, which supplies in the range of 15-20% of US domestic copper demand, is expected to remain affected for the next six months, Rio said in an operational update on Wednesday.
Copper, a metal critical to electrification, is central to Rio’s growth strategy as demand accelerates from the energy transition and the expansion of artificial intelligence data centres. Despite the issues at Kennecott, the company cut costs across its copper business and maintained full-year production guidance of more than 800,000 tons.
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Elsewhere, Rio’s iron ore operations recovered from cyclone disruptions that hit Western Australia’s Pilbara region in the first quarter. Iron ore shipments climbed 17% from the previous quarter and 5% from a year earlier to 88.8 million tons in the three months through June.
The miner also said the conflict in the Middle East has so far had little direct impact on its operations, offering one of the first indications of how the war between the US and Iran is affecting the global mining industry.
There had been “no material disruption to production or outbound supply chains across our core commodities,” Rio said in the update. However, it said diesel prices had jumped to about $140 a barrel from around $85, increasing costs at its Pilbara iron ore business by about 80 cents a ton over the past six months.