Morningstar | Further Supply Disruptions to Boost Near-Term Iron Ore but Declining Steel Demand in China Looms
Like its peer BHP Billiton, Rio Tinto has ridden the commodity supercycle since the early 2000s. Rio Tinto's asset portfolio is less diversified, with iron ore generating the majority of its value. Aluminium and copper are moderate contributors with all coal assets sold in 2018. Aluminium should constitute a substantially larger share, given the USD 40 billion that Rio Tinto controversially paid for Alcan in 2007, but much of that investment is money gone to heaven. Rio has the lowest operating costs of all the iron ore players, but despite this being the bulk of company earnings, excess returns were destroyed by procyclical overinvestment during the China boom.Rio Tinto is a mining group based in the United Kingdom and Australia. Co. is engaged in the business of finding, mining and processing mineral resources. Co.'s major products are iron ore, aluminium, copper, diamonds, coal, uranium, gold and industrial minerals (borax, titanium dioxide and salt). Co.'s activities span the world but are strongly represented in Australia and North America with significant businesses in South America, Asia, Europe and Africa. Co.'s operations comprise four principal product groups - Iron Ore, Aluminium, Copper and Diamonds, and Energy & Minerals.
Morningstar, Inc. is a leading provider of independent investment research in North America, Europe, Australia, and Asia. The company offer an extensive line of products and services for individual investors, financial advisors, asset managers, and retirement plan providers and sponsors.
Morningstar provides data on approximately 530,000 investment offerings, including stocks, mutual funds, and similar vehicles, along with real-time global market data on more than 18 million equities, indexes, futures, options, commodities, and precious metals, in addition to foreign exchange and Treasury markets. Morningstar also offers investment management services through its investment advisory subsidiaries and had approximately $185 billion in assets under advisement and management as of June 30, 2016.
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