Mongolia forces Rio Tinto into major engineering change at copper mine
Copper production from Rio Tinto's most important growth project will not increase as rapidly nor efficiently as expected, after tensions with the Mongolian government forced Rio to make a major engineering change at the Oyu Tolgoi mine.
Rio has been forced to halt eight months of tunnelling work to move the giant underground mine in a northerly direction because the Mongolian government has delayed approval for the mine to enter tenements that are partly owned by Canadian company Entree Resources.
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The Advertiser
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Biosecurity not competition a meaty issue in beef talks
Even if the federal government lowers barriers blocking imports of US beef, it would be no match for higher quality and cheaper to produce Australian cattle. Australia is considering granting more American beef producers access to the local market as a potential bargaining chip to strike a deal on tariffs, as the two nations' leaders prepare to potentially meet face-to-face for the first time. For biosecurity reasons, Australia imposes a soft ban on US beef. Cattle that can be proven to have been raised and slaughtered in the US are allowed into the Australian market, but large amounts of beef sent to American abattoirs come from Mexico or Canada, which are barred from importation. Challenges in tracing the origin of cattle means in practice beef imports are not allowed, until the US can show the same traceability systems Australia has in place. Australian beef producers urged the government not to loosen biosecurity protections. "Australia's biosecurity status is integral to the success and sustainability of our agricultural industries," National Farmers Federation president David Jochinke said. Prime Minister Anthony Albanese assured farmers the government would make no compromises on biosecurity. But as long as biosecurity was protected, Mr Albanese said he would be open to discussions about easing restrictions. David Humphreys, vice chair of industry body Western Beef Association, was open to the idea as well. As long as Australia's biosecurity standards were protected, it would be a beneficial outcome for all Australian farmers if it could be used as leverage to lower US tariffs, he said. Assuming US beef imports posed no disease risk, the impacts for Australian farmers from extra competition would be limited. "Australia has very competitive and relatively cheap beef production in comparison," Mr Humphreys told AAP. "Any beef that's coming in from the US is probably going to be targeting quite select segments of beef consumption, probably the cheaper cuts, produced beef products. "So it's not really competing with the premium Australian beef products that our beef farms produce." The low exchange rate of the Australian dollar as well as the high cost of transporting US beef also reduced the likelihood of it outcompeting homegrown products, he said. Local consumers are accustomed to leaner, higher-quality Australian beef and unlikely to be won over by fatty, hormone-injected American competitors. "I think there's not a lot of risk to Australian producers of beef, with this possibility of some limited US beef being imported into Australia," Mr Humphreys said. Australia's Department of Agriculture is reviewing its ban on Mexican and Canadian beef slaughtered in the US. Agriculture Minister Julie Collins said any decision to allow greater access for US beef would be based on science and evidence. Even if the federal government lowers barriers blocking imports of US beef, it would be no match for higher quality and cheaper to produce Australian cattle. Australia is considering granting more American beef producers access to the local market as a potential bargaining chip to strike a deal on tariffs, as the two nations' leaders prepare to potentially meet face-to-face for the first time. For biosecurity reasons, Australia imposes a soft ban on US beef. Cattle that can be proven to have been raised and slaughtered in the US are allowed into the Australian market, but large amounts of beef sent to American abattoirs come from Mexico or Canada, which are barred from importation. Challenges in tracing the origin of cattle means in practice beef imports are not allowed, until the US can show the same traceability systems Australia has in place. Australian beef producers urged the government not to loosen biosecurity protections. "Australia's biosecurity status is integral to the success and sustainability of our agricultural industries," National Farmers Federation president David Jochinke said. Prime Minister Anthony Albanese assured farmers the government would make no compromises on biosecurity. But as long as biosecurity was protected, Mr Albanese said he would be open to discussions about easing restrictions. David Humphreys, vice chair of industry body Western Beef Association, was open to the idea as well. As long as Australia's biosecurity standards were protected, it would be a beneficial outcome for all Australian farmers if it could be used as leverage to lower US tariffs, he said. Assuming US beef imports posed no disease risk, the impacts for Australian farmers from extra competition would be limited. "Australia has very competitive and relatively cheap beef production in comparison," Mr Humphreys told AAP. "Any beef that's coming in from the US is probably going to be targeting quite select segments of beef consumption, probably the cheaper cuts, produced beef products. "So it's not really competing with the premium Australian beef products that our beef farms produce." The low exchange rate of the Australian dollar as well as the high cost of transporting US beef also reduced the likelihood of it outcompeting homegrown products, he said. Local consumers are accustomed to leaner, higher-quality Australian beef and unlikely to be won over by fatty, hormone-injected American competitors. "I think there's not a lot of risk to Australian producers of beef, with this possibility of some limited US beef being imported into Australia," Mr Humphreys said. Australia's Department of Agriculture is reviewing its ban on Mexican and Canadian beef slaughtered in the US. Agriculture Minister Julie Collins said any decision to allow greater access for US beef would be based on science and evidence. Even if the federal government lowers barriers blocking imports of US beef, it would be no match for higher quality and cheaper to produce Australian cattle. Australia is considering granting more American beef producers access to the local market as a potential bargaining chip to strike a deal on tariffs, as the two nations' leaders prepare to potentially meet face-to-face for the first time. For biosecurity reasons, Australia imposes a soft ban on US beef. Cattle that can be proven to have been raised and slaughtered in the US are allowed into the Australian market, but large amounts of beef sent to American abattoirs come from Mexico or Canada, which are barred from importation. Challenges in tracing the origin of cattle means in practice beef imports are not allowed, until the US can show the same traceability systems Australia has in place. Australian beef producers urged the government not to loosen biosecurity protections. "Australia's biosecurity status is integral to the success and sustainability of our agricultural industries," National Farmers Federation president David Jochinke said. Prime Minister Anthony Albanese assured farmers the government would make no compromises on biosecurity. But as long as biosecurity was protected, Mr Albanese said he would be open to discussions about easing restrictions. David Humphreys, vice chair of industry body Western Beef Association, was open to the idea as well. As long as Australia's biosecurity standards were protected, it would be a beneficial outcome for all Australian farmers if it could be used as leverage to lower US tariffs, he said. Assuming US beef imports posed no disease risk, the impacts for Australian farmers from extra competition would be limited. "Australia has very competitive and relatively cheap beef production in comparison," Mr Humphreys told AAP. "Any beef that's coming in from the US is probably going to be targeting quite select segments of beef consumption, probably the cheaper cuts, produced beef products. "So it's not really competing with the premium Australian beef products that our beef farms produce." The low exchange rate of the Australian dollar as well as the high cost of transporting US beef also reduced the likelihood of it outcompeting homegrown products, he said. Local consumers are accustomed to leaner, higher-quality Australian beef and unlikely to be won over by fatty, hormone-injected American competitors. "I think there's not a lot of risk to Australian producers of beef, with this possibility of some limited US beef being imported into Australia," Mr Humphreys said. Australia's Department of Agriculture is reviewing its ban on Mexican and Canadian beef slaughtered in the US. Agriculture Minister Julie Collins said any decision to allow greater access for US beef would be based on science and evidence. Even if the federal government lowers barriers blocking imports of US beef, it would be no match for higher quality and cheaper to produce Australian cattle. Australia is considering granting more American beef producers access to the local market as a potential bargaining chip to strike a deal on tariffs, as the two nations' leaders prepare to potentially meet face-to-face for the first time. For biosecurity reasons, Australia imposes a soft ban on US beef. Cattle that can be proven to have been raised and slaughtered in the US are allowed into the Australian market, but large amounts of beef sent to American abattoirs come from Mexico or Canada, which are barred from importation. Challenges in tracing the origin of cattle means in practice beef imports are not allowed, until the US can show the same traceability systems Australia has in place. Australian beef producers urged the government not to loosen biosecurity protections. "Australia's biosecurity status is integral to the success and sustainability of our agricultural industries," National Farmers Federation president David Jochinke said. Prime Minister Anthony Albanese assured farmers the government would make no compromises on biosecurity. But as long as biosecurity was protected, Mr Albanese said he would be open to discussions about easing restrictions. David Humphreys, vice chair of industry body Western Beef Association, was open to the idea as well. As long as Australia's biosecurity standards were protected, it would be a beneficial outcome for all Australian farmers if it could be used as leverage to lower US tariffs, he said. Assuming US beef imports posed no disease risk, the impacts for Australian farmers from extra competition would be limited. "Australia has very competitive and relatively cheap beef production in comparison," Mr Humphreys told AAP. "Any beef that's coming in from the US is probably going to be targeting quite select segments of beef consumption, probably the cheaper cuts, produced beef products. "So it's not really competing with the premium Australian beef products that our beef farms produce." The low exchange rate of the Australian dollar as well as the high cost of transporting US beef also reduced the likelihood of it outcompeting homegrown products, he said. Local consumers are accustomed to leaner, higher-quality Australian beef and unlikely to be won over by fatty, hormone-injected American competitors. "I think there's not a lot of risk to Australian producers of beef, with this possibility of some limited US beef being imported into Australia," Mr Humphreys said. Australia's Department of Agriculture is reviewing its ban on Mexican and Canadian beef slaughtered in the US. Agriculture Minister Julie Collins said any decision to allow greater access for US beef would be based on science and evidence.
AU Financial Review
12 hours ago
- AU Financial Review
Mongolia forces Rio Tinto into major engineering change at copper mine
Copper production from Rio Tinto's most important growth project will not increase as rapidly nor efficiently as expected, after tensions with the Mongolian government forced Rio to make a major engineering change at the Oyu Tolgoi mine. Rio has been forced to halt eight months of tunnelling work to move the giant underground mine in a northerly direction because the Mongolian government has delayed approval for the mine to enter tenements that are partly owned by Canadian company Entree Resources.
News.com.au
a day ago
- News.com.au
Rio stays the course on lithium as it looks to rejuvenate iron ore business
Outgoing Rio Tinto boss Jakob Stausholm says Rio remains committed to its lithium strategy Mining giant just opened newest iron ore operation in WA's Pilbara CEO denies being nudged by board as he says company leaders are aligned on ESG and operational improvements The head of the world's second biggest miner Rio Tinto (ASX:RIO) says its board remains aligned on a counter-cyclical push into lithium as CEO Jakob Stausholm denied speculation that friction with the company's board was behind his decision to resign this year. Stausholm's near five year tenure at Rio followed the destruction of the Juukan Gorge rock cave in the Pilbara under his predecessor JS Jacques, an act that led to Jacques' resignation and steered the $150bn miner on a course to prioritise its ESG commitments. In that time, its new investments have focused in two areas, replacement mines to address declining iron ore quality at its flagship Pilbara operations and M&A to become one of the world's largest lithium producers. The latter has come under the microscope amid Stausholm's surprise exit, with lithium prices crashing to four year lows after Rio's entry as a producer via its $10 billion takeover of Argentine brine producer Allkem. Speaking at the opening of Rio's first of five major replacement iron ore mines due in the next five years – the 25Mtpa Western Range with Chinese steel giant Baowu near Paraburdoo – Stausholm said Rio's board remained aligned on its lithium strategy. "The lithium strategy we are absolutely aligned about in the whole board. This is a next pillar," he said. "Think about it like some visionary people 50-60 years ago said Rio Tinto should go into iron ore. "We need to think about the future to the next decade and the next decade. And we are lucky that we have built now a portfolio of outstanding brine resources in Argentina, in Chile. " It's going to complement our – what I would call signature – business here of iron ore for the future." Grade control Under Stausholm, Rio has cleared a number of social licence hurdles in its WA heartland culminating in an agreement this week with the PKKP group, the very Traditional Owner group devastated by the 2020 demolition of Juukan Gorge. It will be a key stakeholder for the US$1.8bn Brockman Syncline 1, the next replacement mine approved for the ~40Mtpa Brockman hub, one of a number of developments that will cost Rio in the order of US$13bn to deliver in the coming years. Western Range is a milestone in that it marks the first new operation delivered by Rio's iron ore division since Juukan Gorge (its Gudai-Darri mine was under construction at the time), and the first to a mine plan co-designed with the TO group, the Yinhawangka People. But Rio's iron ore division has been, quite literally, degrading. 2023 and 2024 marked long time highs for iron ore production at 331.8Mt and 328.6Mt, making Rio the largest exporter of hematite iron ore in the world. But costs have been escalating at a faster rate – on reported numbers at least – than its peers BHP and Fortescue. While BHP and FMG reported C1 cash costs of US$17.50/t and US$19.17/wmt in the first half of FY2025, Rio's unit cash costs came in at US$23/t in CY24. Its 2025 numbers will likely be higher at a guided range of US$23-24.50/t. And while 62% Fe Singapore iron ore futures are sitting at US$95.55/t, Rio's realisation to the benchmark price has been slipping. It notified customers that during the September quarter the spec grade for its Pilbara Blend product will drop. Fastmarkets this week introduced a 61% Fe Index to reflect the lower quality product Pilbara miners are now shipping. It will likely take until the end of this decade, when Rio delivers the higher grade Rhodes Ridge mine, for its grade to recover. Speaking at the Western Range opening, Stausholm denied any rift with new chair Dominic Barton, nor that the miner's focus on ESG under his leadership had clouded its dedication to operating performance. "We are absolutely aligned. It's very important to say we in the management team and the whole board (are) absolutely aligned around the values of Rio Tinto about pursuing the four objectives, about our strategy and the strategic choices and about the assessment of our performance," Stausholm said. "So there is no disalignment. "We are absolutely aligned. It's very important to say we in the management team and the whole board (are) absolutely aligned around the values of Rio Tinto about pursuing the four objectives, about our strategy and the strategic choices and about the assessment of our performance," Stausholm said. "So there is no disalignment. "If you look at my statements at the full year results, I said exactly the same thing because we have under the four objectives, made a lot of progress on rebuilding trust in the company, working towards impeccable ESG credentials, improving how we execute projects. " This project is an example. This project is on time, on schedule. "We still have the potential to do in the best operator, our safe production system is really working. So I said that at the full year, and my chairman repeated that a couple of weeks ago." Steel on top The official opening of Western Range marked a second major development in the relationship between Rio and China's top steel producer Baowu in the Pilbara after the development of Eastern Range in the early 2000s. It followed Rio's landmark first deal with China's Sinosteel at the nearby Channar JV almost 40 years ago. Australia now ships over 900Mt of iron ore a year, the vast bulk of it (around 80%) to China, the world's largest steel producer. But as new, high quality ore sources are developed overseas – notably the high grade 120Mtpa Simandou project in Guinea in which both Rio and Baowu are invested – question marks are hovering over the centrality of the long-established "conveyor belt" between the Pilbara and Beijing to the steel supply chain. FMG chairman Andrew Forrest notably sounded the alarm in recent months over the emergence of new competitors to WA who could eat its golden goose. He is lobbying hard for the establishment of a domestic green iron industry. But Rio remains confident in the role Australian iron ore will play in the future, even in a decarbonising world where green steel technologies – not suited to low and mid-grade ores produced in the Pilbara – could dominate. "It is for us as companies to make sure that the Pilbara ore remains relevant," Stausholm said. "And how do we do that? We do that in partnerships like you see today with Baowu, working on how can we decarbonise the supply chain. " If you find the right solutions and we will, then Pilbara will be the source for many, many decades to come." Stausholm's departure comes as BHP is also rumoured to be looking for a new CEO to replace Mike Henry, and has a number of internal Rio candidates reputedly jostling for position, among them chief commercial officer Bold Baatar and local favourite Simon Trott, who helped open Western Range on Friday and runs the major's iron ore division out of its Perth office.
