(Adds detail, writes through)MELBOURNE, July 16 (Reuters) - Rio Tintoreported a 12% fall in quarterly iron ore shipments on Fridayafter storms affected its West Australian operations, but isexpected to report bumper results this month on soaring pricesfor the steel raw material.Rio said it now expects to ship near the lower end of itsrange of 325 million tonnes (mt) and 340 mt in calendar 2021,meaning it may hand back its crown as the world's biggestproducer to Brazilian rival Vale S.A. .Vale, which reports output later this month, is on track tomeet the upper end of its 2021 guidance of 315-335 mt, accordingto UBS.
Rio shipped 76.3 million tonnes (mt) of the steel-makingcommodity for the three months ended June 30, down from 86.7 mta year ago, just ahead of a UBS estimate of 76 mt."We would have liked to have seen higher production tocapitalise on these iron ore prices. Still, they are going to beswimming in cash at results time," said analyst David Lennox atFat Prophets in Sydney."Hopefully we will get a good dividend and we are lookingfor a share buyback as well."Iron ore prices surged to records above $230 a tonne in Maythanks to a post-COVID infrastructure drive by China.
Rio is expected to post half-year underlying earnings of$10.9 billion on July 28 according to a Vuma consensus of 14analysts, more than double the $4.75 billion it reported for thesame period last year.Rio on Friday also raised its full-year iron oreproduction cost guidance due to increased labour and inputcosts.The miner expects unit costs of $18.00-$18.50 per tonne forthe year, up from its previous estimate of $16.70-$17.70 pertonne, even as prices it received for iron ore doubled to$168.40 a dry metric tonne free on board for the first half.
Miners have been facing labour shortages as Australia hasshut international borders and snap closed state borders.Rio also said it delayed commissioning at its newGudai-Darri iron ore hub to later this year and first productionfrom its Winu copper find in Australia to 2025 from originalestimates of 2023, partly due to COVID restrictions.It lowered 2021 production by 2 Mt due to new strategies toprotect Aboriginal areas of high cultural significance as itseeks to repair relations with Aboriginal groups following itsdestruction of rock shelters at Juukan Gorge last year.
(Reporting by Melanie Burton in Melbourne and Sameer Manekarand Anushka Trivedi in Bengaluru; Editing by Krishna ChandraEluri and Richard Pullin)
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