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Rio Tinto to cut iron ore jobs as it braces for tough market
[SYDNEY] Miner Rio Tinto is preparing to cut hundreds of jobs at its Australian iron ore business following a restructuring of the global giant's most profitable sector, the company confirmed on Monday.
A Rio Tinto spokesman declined to say how many jobs would go, although local media reported up to 500 management and support positions were on the line. "There will be cuts," a Rio spokesman said, adding that the move was part of a wider review to streamline the company as it braces for continued volatility in minerals commodities markets.
It is the third major staff cut at Rio in the past two years. The company currently employs about 11,000 workers after shedding about 700 people early this year and about 800 early last year.
About 440 workers and contractors at one of Rio's Pilbara mines last week were notified by management that there would be a two-week shutdown over Christmas, with staff directed to take leave amid "challenging conditions."
The most-traded January iron ore contract on the Dalian Commodity Exchange stood at 551 yuan a tonne on Monday, providing Rio with a profit of around US$50 for each tonne it mines.
But Rio is expected to tell a meeting of investors and analysts on Thursday that it expects iron ore prices to recoil next year, as demand from Chinese steel mills tapers off, according to analysts.
Iron ore sank to a long-term low of around US$38 a tonne late last year.