Rio Tinto boosts 2025 capex and copper output guidance

Investing.com -- Rio Tinto (LON:RIO ) (ASX:RIO ) has posted an updated production and expenditure guidance ahead of its annual Investor Seminar. 

While the mining giant reiterated its commitment to long-term growth, details for 2025 fell short of some analyst expectations, with capital expenditure set to rise and production targets in key segments coming in below consensus forecasts.

The company reaffirmed its focus on expanding production at an average annual growth rate of around 3% until 2033—pushing this target back five years from its previous 2028 timeline. 

Analysts at RBC Capital Markets suggest the extended timeframe reflects delays in key projects, including the Rincon lithium operation and the transition at Arcadium.

Rio Tinto now expects capex of approximately $11 billion in 2025, up from prior guidance of $10 billion, citing additional investments in near-term production assets. 

Mid-term capex forecasts were also revised upward to $10–11 billion annually. RBC analysts had previously estimated 2025 capex at $10.5 billion, compared to a market consensus of $10.1 billion.

Copper production remains a bright spot in Rio’s portfolio, with output forecast to reach 780,000–850,000 tonnes in 2025. 

This aligns with consensus expectations of 818,000 tonnes and reflects growth driven by projects such as the ramp-up at Oyu Tolgoi in Mongolia and increased production at the Bingham Canyon mine in the United States. 

By 2028, Rio expects annual copper production to hit 1 million tonnes, supported by these and other operations.

The miner’s cornerstone iron ore segment delivered weaker-than-expected projections for 2025. Pilbara shipments are forecast at 323–338 million tonnes, below market consensus of 338 million tonnes. 

Similarly, alumina production guidance for 2025, at 7.4–7.8 million tonnes, fell slightly short of market expectations.

Other segments, including aluminium and titanium dioxide slag, aligned broadly with forecasts. 

Aluminium production guidance of 3.25–3.45 million tonnes for 2025 is consistent with consensus, as is attributable production guidance for the Iron Ore Company of Canada (9.7–11.4 million tonnes).

The Rincon lithium project in Argentina is expected to deliver 53,000 tonnes per annum of battery-grade lithium carbonate for 40 years, with potential for expansion to 60,000 tonnes. The Rincon 3000 starter plant is slated for completion by mid-2025.

Progress was also reported at the Simandou iron ore project in Guinea, where construction of mine, port, and rail infrastructure remains on track. 

Full capacity of 60 million tonnes per annum (Rio’s share) is targeted by 2028, although analysts caution that infrastructure challenges could delay early exports.

Another key development involves the Winu copper-gold project in Western Australia. A joint venture with Sumitomo Metal Mining is set to finalize next year, with a pre-feasibility study expected by 2025. 

Analysts at RBC have yet to attribute value to either Winu or Rincon due to early-stage uncertainty.

Source: Investing.com