Australian Iron-Ore Producer Aims For No. 2 Spot

ByBridge News Melbourne-based Rio Tinto Ltd. is aiming to become the world's second-biggest iron-ore producer through a takeover of North Ltd. Major North assets include forestry interests, iron-ore mines in Canada and Australia, and uranium mines in Australia, as well as various base- and precious-metals interests. Rio Tinto has a huge portfolio of mines all over the world. Rio Tinto's Hamersley Iron subsidiary can produce about 60 million tons of iron ore per year, while North's Robe River project can produce about 30 million tons. Combining the two projects would give Rio Tinto Australian iron-ore output of 90 million tons per year. "If this goes through, they're going to be No. 2 in the world after Companhia Vale do Rio Doce (CVRD) of Brazil [which had 1999 iron-ore production of 95 million tons]," says Henry Antwi, principal iron ore analyst at AME Mineral Economics in Sydney. "In that sense, they'd gain bargaining power. Rio Tinto would increase their market share into the Japanese market."