Rio shares lower as flooded port facility halts shipments
Make us a preferred source
Make us a preferred source on Google
More news: Rio Tinto shares lowered in morning trade after the mining group warned that record rain in the Karratha region of Western Australia flooded a port facility and temporarily halted iron ore shipments.
Rio shares were down 0.4% at $117.51 by midday AEDT as the materials sector shaved 0.3% and the ASX 200 index rose 0.4%.
RBC Capital Markets analyst Kaan Peker said that while Rio's first-half shipments are expected to be impacted, calendar-year shipments are likely to be made up in the second half.
However, Peker noted that the damage has disproportionately impacted Rio compared to its peers. A flooded railcar dumper at the East Intercourse Island (EII) port facility, which shipped 45 million tonnes of Rio's iron ore shipments in 2024, is expected be offline for three to four weeks. Meanwhile, BHP and Fortescue activities are reportedly returning to normal.
The analyst said that the impact from downtime at EII is worse from a product quality and equity volumes perspective, as the port is solely used to ship Rio's higher-grading Pilbara Blend lump and fines iron ore, and not its lower-grade products. Also, port stocks were already low and this quarter was expected to see a re-build if mine inventory which was depleted over 2024.
Rio Tinto shipments to be affected after record Pilbara rain
The news: Mining giant Rio Tinto says its first quarter shipments will be affected after record rain from Tropical Cyclone Sean flooded the East Intercourse Island (EII) port facility in Western Australia.
The numbers: Rio said initial indications suggest a flooded railcar dumper at EII could be offline for three to four weeks, as rectifications works are required. EII shipped 45 million tonnes of Rio’s iron ore shipments in 2024.
The context: The global miner said while first quarter shipments will be affected, its overall shipment guidance for 2025 remains unchanged. The rail and port operations were affected after Tropical Cyclone Sean delivered a record 274mm to the Karratha region on 20 January. The company said recovery works within the broader iron ore system are progressing, with the majority of rail and port operations now returned to operations. It is working to mitigate impacts and will provide an update at its full-year results on 19 February.
Earlier this month, Rio Tinto outlined full-year shipments guidance of 323 to 338 million tonnes for 2025.
The sources: Rio Tinto media release, RBC Capital Markets research
