Rio Tinto is broadening its metals-trading operations to handle third-party volumes and use financial derivatives, marking a strategic shift for the world’s second-largest miner as it seeks to extract more value from its global asset base.
Under the plan, the company will buy and sell metals produced by other miners in markets where its existing infrastructure provides an edge, rather than building a standalone trading house on the scale of Glencore or Trafigura. Initial focus areas include alumina, where Rio has regional surpluses and shortages it can arbitrage, and North American copper, where spare smelting capacity at its Kennecott operation in Utah creates room to process and trade additional material, including copper cathode and related products such as sulphuric acid.
The commercial team, currently around 20 traders, is expected to add a handful more staff as the desk scales. Derivatives will be used strictly to hedge physical positions and commercial exposures, not to take directional bets on commodity prices, the company has indicated.
“Marketing equity tonnes from our own operations to meet the needs of customers and partners remains the foundation of Rio Tinto’s business,” the miner said in a statement. “Alongside this, we are continuing to grow our capability to buy and sell products on behalf of third parties,” adding that the move is aimed at maximising infrastructure utilisation, optimising placement of its own production and offering customers greater optionality.
Rio Tinto to expand metals trading beyond own output
