Rio Tinto iron ore sales rise 7% in Q2, copper costs nearly halved

Rio Tinto posted better-than-expected second-quarter iron ore sales of 85.3 million metric tons from its Pilbara operations, up 7% from a year earlier and ahead of the Visible Alpha consensus estimate of 83.6 Mt, supported by strong system performance and healthy stock levels after two tropical cyclones disrupted operations earlier this year.

"We achieved our highest first-half iron ore production since we set a record in 2018, through the successful implementation of our ongoing productivity improvement program," Chief Executive Simon Trott said.

First-half sales reached 157.7 Mt, 5% higher than last year, leaving the world's largest iron ore producer needing a stronger second half to hit its 2026 forecast range of 323 Mt to 338 Mt. Average pricing at Pilbara improved to $85.20 per wet metric ton on a free-on-board basis from $83.20 a year earlier, though higher diesel prices — which rose to about $140 a barrel from roughly $85 in the first half — added about 80 cents a ton to unit costs.

The result shows Rio Tinto's ability to maintain iron ore output at scale while navigating cost pressures from the Middle East conflict, which has lifted global energy costs. The miner said it is monitoring conditions in the Strait of Hormuz and maintaining contingency plans for potential escalation. Shares jumped as much as 2.8% to a one-week high, outperforming the mining sub-index.

Copper Output Slips as Costs Shrink

Consolidated copper production fell 7% year-over-year to 213,000 metric tons in the second quarter, missing the Visible Alpha consensus of 214.7 Kt, as a furnace outage at the Kennecott mine in Utah and lower grades at Chile's Escondida weighed on output. The flash smelting furnace breach at Kennecott will take about 75 days to repair, reducing refined metal production in the second half.

Escondida concentrate production declined 13% on lower ore grades, while the Oyu Tolgoi mine in Mongolia continued its ramp-up, contributing to a 1% increase in first-half copper output overall.

Rio Tinto slashed its 2026 copper C1 net unit cost forecast to between 30 and 50 U.S. cents per pound from 65 to 75 cents, citing higher-than-expected gold prices — a byproduct of its copper mining — and productivity improvements. The revised guidance points to a significant margin improvement for the copper division, which has been a key growth focus for the miner alongside its iron ore cash cow.

The company maintained all major 2026 production guidance across its portfolio, including the Pilbara iron ore cost outlook of $23.50 to $25.00 per ton. Rio Tinto's copper equivalent production rose 3% in the first half, driven by record Pilbara iron ore output since 2018, the Oyu Tolgoi ramp-up, and resilient aluminum operations.

This article is for informational purposes only and does not constitute investment advice.