The mining company Rio Tinto says that it mined a record amount of iron ore and aluminium, amid strong demand from emerging nations including China.
Rio Tinto said that despite profiting from the increasing demand, it was also facing rising costs and had to pay more for its staff, equipment and fuel.
The comments were made in a production report covering the second quarter running from April to the end of June.
They come as the firm is fighting off a takeover from rival BHP Billiton.
Demand
The chief executive of Rio Tinto, Tom Albanese, says that the cost of production at the firm's Australian mines means that it is not profiting as much as they could be from the runaway demand for metals.
One of the main problems is the limited number of experienced mining engineers available, which hampers production and pushes up the wage bill.
Rio Tinto says they have to pay higher salaries to attract talented workers.
The company expanded last year, after acquiring the Canadian aluminium maker, Alcan.
It is now facing an unsolicited takeover bid from its larger rival BHP Billiton.
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