Insights

Rio Tinto (ASX:RIO) share price rises despite aluminium production cuts

Investors appear unfazed by recently announced production cuts in Canada…
The post Rio Tinto (ASX:RIO) share price rises despite aluminium production cuts appeared first on The Motley Fool Australia. –

The Rio Tinto Limited (ASX: RIO) share price is on track to finish the day higher. It appears the latest reports of production cuts in Canada isn’t slowing down the mining giant on Tuesday.

At the time of writing, shares in the multinational mining company are 1.99% higher at $132.70. Elevated iron ore and copper prices have helped Rio shares to achieve a gain of 27.6% over the past year.

Let’s take a closer look at what has instigated the company’s production cuts.

Union troubles lead to production cuts

Investors are buying up Rio Tinto shares today despite the latest news of production cuts at the company’s Canadian aluminium smelter.

According to a release, production at BC Works smelter in Kitimat, Canada will suffer a significant cut after the company failed to reach an agreement on a new collective labour agreement with a local union.

Production will be reduced to 35% of the smelter’s 432,000 tonne annual capacity. This is so it can operate safely under an essential services order granted by the BC Labour Relations Board.

Rio Tinto aluminium managing director of atlantic operations Samir Cairae stated:

Reducing production will have a significant impact on the business and community, but we are committed to taking the necessary steps to operate safely with a reduced workforce.

We have made every effort to reach a mutually beneficial agreement through negotiating in good faith over the past seven weeks, including proposing an independent mediator which was rejected by Unifor Local 2301. We will continue to look for longer-term solutions with the union and work closely with customers and suppliers to minimise disruptions.

Similarly, a reduced workforce is also in place at the Kemano hydro-power facility to ensure safe operations.

The Unifor Local 2301 union represents approximately 900 of the 1,050 employees at the smelter.

Rio Tinto share price on upcoming results

ASX-listed Rio’s half-year results are slated for release tomorrow. Investors might be squeezing in last minute in expectation of solid results.

However, the company recently noted iron ore shipments will be at the lower end of its guidance range. Despite this, the continued strength in iron ore prices appears to have maintained optimism towards the Rio Tinto share price.

The post Rio Tinto (ASX:RIO) share price rises despite aluminium production cuts appeared first on The Motley Fool Australia.

Should you invest $1,000 in Rio Tinto right now?

Before you consider Rio Tinto, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Rio Tinto wasn’t one of them.

The online investing service he’s run for nearly a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of May 24th 2021

More reading

Lynas share price soars, BHP and Rio on watch, A2 on the naughty list. Scott Phillips on Nine’s Late News

What to expect from the ASX 200 during earnings season

Why City Chic, Lynas Rare Earths, Rio Tinto, & Stavely Minerals are charging higher

Own Rio Tinto (ASX:RIO) shares? What to look for when the miner reports on Wednesday
ASX 200 Weekly Wrap: Just like that… ASX back to record highs

Motley Fool contributor Mitchell Lawler has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

Trade The World Anywhere & Anytime!

Mobile app platform with over 50,000 global listed securities across 12 markets (over 70% global market capitalisation), right from your Android or iOS device.

Integrated with exclusive trading idea and investment analysis tools to help you find actionable insight on virtually every financial instrument across our 12 global markets, to help you optimise your trading strategies.

Refer Your Friends

Tell your friends about Monex and gift them FREE access to our trading tools.

We respect your privacy and will only send this one email notification to your friends. 

Share With Your Friends

Share on facebook
Share on twitter
Share on linkedin

Monex Trading Tools Access and Usage Terms

The Monex Trading Tools (referred to as ‘tools’ hereafter) are available to you inside your client portal;


To activate access to the tools, you must have a verified and approved trading account and have made a deposit of at least AUD $1000.


An active and funded account with a positive trading balance is required to continue to have access to the tools;


Although the tools are available to you indefinitely, Monex Securities may at it’s discretion disable access to the tools in the future;


Monex securities reserves the right to change these terms and conditions from time to time, as it sees fit, without notice.

Important Notice
iOS & Android App - 12 International Markets & Over 70% Global Market Cap. $0 Brokerage On US Trades. Click Here!