Skip to content

CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved. CFDs are leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your deposits, so please ensure that you fully understand the risks involved.

Rio Tinto share price: iron ore shipments hit 327.4mt in 2019

We examine Rio Tinto’s latest Q4 production results, with a primary focus on the results of the company’s iron ore operations.

Rio Tinto Q4 production results Source: Bloomberg

Rio Tinto share price rises on Q4 release

Rio Tinto (ASX: RIO) – the $38bn Metals & Mining company – today released its fourth quarter production results to the market. In response, its stock bounced at the open, with the Rio Tinto share price trading up to the $104.610 mark.

While today’s production release doesn’t provide investors with the full picture of RIO’s FY19 financials, it does give us insight into the company’s all-important shipment and production statistics.

Overall, Rio Tinto saw its iron ore shipments rise during the fourth quarter, hitting 86.8 million tonnes in Q4 – representing an increase of 1% on Q3. In saying that, and though shipments rose, production fell during the fourth quarter: hitting 83.6 million tonnes in Q4.

Looking at the broader picture, FY19’s front-line production and shipment figures came in a shade lower: here, Pilbara iron ore shipments and production (on 100% basis) came in at 327.4 million tonnes and 326.7 million tonnes, respectively – both down ~3% vs 2018.

As has been a theme of the company's market commentary over the last year, Rio attributed these modest declines to challenging weather conditions and operational difficulties experienced in H1 FY19. The company also noted that this was compounded by the ‘active decision to protect the quality of the Pilbara Blend.’

Speaking to the company's latest market release, CEO J-S Jacques commented:

'We finished the year with good momentum, particularly in our Pilbara iron ore operations and in bauxite, despite having experienced some operational challenges in 2019.'

Mr Jacques also said:

'We are increasing our investment, with $2.25 billion of high-return projects in iron ore and copper approved in the fourth quarter.'

The 2020 outlook

Though Rio Tinto faced challenges in 2019, the company provided optimistic commentary around 2020. Here it was noted that:

'Our increased focus on waste material movement and pit development will continue in 2020 to improve mine performance and pit sequencing.'

All up, the miner expects 2020 iron ore shipments in the range of 330 million tonnes to 343 million tonnes – on a 100% basis.

As is typically the case, Rio Tinto noted that estimates surrounding iron ore were subject to weather and market conditions.

Iron ore prices: the story so far

Looking at the impact of buoyant iron ore prices over the last year and on a wet metric tonne (WMT) basis, Rio achieved an average iron ore price of $79.0 during 2019. This represents a ~36% increase on the year prior, with Rio seeing average iron ore prices of $57.8 per WMT in 2018.

At the time of writing, the 62% iron ore Fe Fines spot price traded at the US$94.55 per tonne mark.

After today's Q4 release, the Rio Tinto (ASX: RIO) share price is now up ~30% over the last year.

IGA, may distribute information/research produced by its respective foreign affiliates within the IG Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations. Where the research is distributed in Singapore to a person who is not an Accredited Investor, Expert Investor or an Institutional Investor, IGA accepts legal responsibility for the contents of the report to such persons only to the extent required by law. Singapore recipients should contact IGA at 6390 5118 for matters arising from, or in connection with the information distributed.

The information/research herein is prepared by IG Asia Pte Ltd (IGA) and its foreign affiliated companies (collectively known as the IG Group) and is intended for general circulation only. It does not take into account the specific investment objectives, financial situation, or particular needs of any particular person. You should take into account your specific investment objectives, financial situation, and particular needs before making a commitment to trade, including seeking advice from an independent financial adviser regarding the suitability of the investment, under a separate engagement, as you deem fit.

No representation or warranty is given as to the accuracy or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. Please see important Research Disclaimer.

Please also note that the information does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. Any views and opinions expressed may be changed without an update.

Seize a share opportunity today

Go long or short on thousands of international stocks.

  • Increase your market exposure with leverage
  • Get spreads from just 0.1% on major global shares
  • Trade CFDs straight into order books with direct market access
Learn more

Live prices on most popular markets

  • Forex
  • Shares
  • Indices

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.

Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 20 mins.

The Momentum Report

Get the week’s momentum report sent directly to your inbox every Tuesday for FREE. The Week Ahead gives you a full calendar of upcoming key events to monitor in the coming week, as well as commentary and insight from our expert analysts on the major indices to watch.

For more info on how we might use your data, see our privacy notice and access policy and privacy webpage.

You might be interested in…

<h3>How much does trading cost?</h3>
<h3>Find out about IG</h3>
<h3>Plan your trading</h3>

Find out what charges your trades could incur with our transparent fee structure.

Discover why so many clients choose us, and what makes us a world-leading provider of CFDs.

Stay on top of upcoming market-moving events with our customisable economic calendar.