RAPAPORT… Weak rough prices pushed Rio Tinto’s diamond unit into the
red in the first half of the year, the miner reported Thursday.
The division recorded a net loss of $5 million for the six
months ending June 30, compared with a profit of $55 million a year ago. Diamond
sales fell 16% to $271 million for the period.
Production dropped 10% to 8.3 million carats, primarily due
to a 13% decrease in output at the Argyle mine in Australia amid lower ore
grades. Recoveries at the Diavik deposit in Canada fell 1%, as reduced grades outweighed
higher processing volumes. The miner maintained its overall production forecast
of 15 million to 17 million carats for this year.
Rio Tinto holds 100% of Argyle, as well as 60% of Diavik,
which it owns in partnership with Dominion Diamond Mines.
Image: An aerial view of the Diavik mine. (Dominion Diamond Mines)
Rio Tinto Incurs Loss in Diamond Division
The Bottom Line
- Rio Tinto's diamond unit posted a $5 million net loss for the six months ending June 30, down from a $55 million profit a year earlier.
- Diamond sales declined 16% to $271 million, while production fell 10% to 8.3 million carats, driven by a 13% drop at the Argyle mine.
- Despite lower ore grades and reduced recoveries at Diavik, Rio Tinto maintained its full-year production forecast of 15 million to 17 million carats.
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