JPM-Rio Tinto plc Q225 production first take：Iron Ore shipments a slight miss, but Copper a beat-20250716

Our take - Copper is stand-out positive: Q2 Iron Ore shipments of 79.9Mt(320Mt pa) are -5% vs JPMe and remain guided at the lower end of the 323-338Mtrange due to significant cyclone disruption in Q1. Iron Ore production of 83.7Mt(336 Mt pa) was only -1% JPMe, +20% QoQ and the strongest Q2 since 2018.Mined Copper was +11% JPMe due to strong performance at OT and Kennecott.2025 mined Copper production is likely to be at the upper end of guidance (780-850kt) and unit costs at the lower end ($1.30-1.50/lb). Aluminium production was-2% JPMe. RIO guides to the first Simandou iron ore shipment in Nov’25, with0.5-1.0Mt expected in 2025, which is in line with our expectations and the recentBaosteel guide. We are Overweight, with RIO trading on spot 4.9x/4.4x EV/EBITDA 2025E/26E and 6%/7% FCF yield.

•Noteworthy Areas:1) Q2’25 Iron Ore shipments (79.9Mt) are -5% JPMe(320Mt pa run-rate) and $82.5/t price received is ~$1/t below JPMe. Copperis +11% JPMe due to record production at Oyu Tolgoi, and 2025 production isnow guided towards the top end of 780-850kt (JPMe 826kt). Aluminium(842kt) is -2% vs JPMe while Bauxite (15.6Mt) was +4% vs JPMe. 2) AtSimandou, management guides for a first shipment accelerated to Nov’25 andexpects 0.5-1.0Mt shipments in 2025. 3) RIO guides to a $0.6bn workingcapital build for H1’25.