Mining giant, Rio Tinto plc (RIO - Free Report) , recently announced strong operational results for third-quarter 2013. The company reported a year-over-year increase in production for majority of its commodities including borates, mined copper, diamonds, silver, coal and gold. However, production of certain other commodities like molybdenum, uranium, alumina and salt plunged during the quarter.
Rio Tinto achieved a new high for iron ore production and shipments in the third quarter. Iron ore production reached 68.3 million tonnes in the quarter, representing an increase of 2% year over year, primarily from the contribution of Pilbara. Given its expansion projects, Pilbara is expected to contribute significantly in the coming quarters. In September, Rio Tinto started shipments from Western Australia where the iron ore capacity was increased to 290 million tonnes per year. In 2013, the company expects to produce roughly 265 million tonnes of iron ore from its Australian and Canadian operations.
Rio Tinto expects copper production to increase in the upcoming quarters due to a fast recovery of the pit wall slide in April at the Kennecott Utah Copper mine. The mine is expected to produce 185,000 tonnes of mined copper in 2013. In 2013, Rio Tinto is expected to produce 590,000 tonnes and 270,000 tonnes of mined and refined copper, respectively.
We expect coal production to continue increasing in the quarters ahead, based on the company’s growth projects. In July, Rio Tinto started coal production at the $2.0 billion Kestrel Mine Extension, near Queensland, which will add 20 more operational years to the mine. Kestrel South is expected to reach full capacity by the end of 2014 and produce an average of 5.7 million tonnes per annum over the next 20 years.
Currently, the company has various exploration projects in regions including Australia, the USA, Chile, Russia, Uzbekistan, China, Canada, Namibia, Brazil and India. We expect these projects to translate into increased production and higher revenues for the company.
Rio Tinto currently carries a Zacks Rank #3 (Hold). Other stocks to watch out for in the industry include Denison Mines Corp. , Stillwater Mining Co. and Tahoe Resources Inc. (TAHO - Free Report) . While Denison Mines holds a Zacks Rank #1 (Strong Buy), Stillwater Mining and Tahoe Resources carry a Zacks Rank #2 (Buy).