Rio Tinto cuts copper unit costs nearly in half for 2026

Rio Tinto Ltd's Pilbara iron ore unit posted its strongest first-half production since 2018, beating consensus estimates alongside stronger shipment volumes, as the miner reiterated full-year guidance across all segments. Second-quarter production beat expectations in both Pilbara output and shipment volumes, while the rest of Rio's major operating assets came in line with consensus. Jefferies reiterated a Hold rating on Rio, citing relative valuation and a preference for miners with more direct copper leverage. "While mostly an uneventful report from Rio, the quarter-over-quarter rebound in volumes at certain assets in Q2 is encouraging," Jefferies analysts wrote. Cash generation in the first half was impacted by roughly $1.6 billion in tax and working capital outflows, the brokerage noted. Pilbara shipment volumes rose 18% quarter-on-quarter as the company shipped excess production from the first quarter that had previously been constrained by extreme weather. Rio's SP10 classification volumes fell to 8% of sales, down from around 12% in recent quarters. Rising diesel costs pushed first-half unit costs up about $0.8 per tonne year-on-year, though Jefferies noted full-year cash cost guidance in the Pilbara remains unchanged. Iron Ore Company of Canada production and shipment volumes declined both sequentially and year-on-year due to lower concentrator feed and an ongoing ore dumper replacement project. Full-year guidance for the operation is subject to the impact of recent forest fires in Canada. At Simandou, production increased quarter-on-quarter following a phased restart after a fatality in the first quarter.