Iron ore—the rust-colored raw material key to steelmaking—is the most important piece of mining giant Rio Tinto’s business, accounting for more than 70% of the company’s profit. And the company continues to scrape tons of the stuff out of the earth. In its fourth-quarter 2012 operational review Rio spotlighted record iron ore production and shipments. And those numbers come even amid wild swings in the price of the commodity. Since striking recent lows in September they’re up about 80%, amid a broad push from Chinese steel mills to restock.
Despite the recent rebound in prices, there is plenty of concern that demand from China might prove ephemeral. And the canned quote from Rio Tinto chief Tom Albanese focused on company plans to cut costs rather than boost production. “Markets remain volatile, but our business continues to perform well. Across the Group we are taking action to roll back unsustainable cost increases. This further enhances our resilience and competitive edge as we enter 2013,” he said. That’s hardly a full-throated declaration that demand from China’s steel mills is sure to last.