Rio Tinto is one of the world's largest producers of iron ore, having mining operations in Western Australia, Canada and Brazil. The ore is shipped to world steel plants where it is converted in blast furnaces into iron and steel.

Steel is the workhorse of modern economies. Its use (over 800 million tonnes a year) completely dwarfs that of other metals. Steel is most intensively used at a relatively early stage of industrialisation when a country is establishing basic infrastructure. Thus, although all countries make extensive use of steel, the fastest growth is generally to be found in developing countries. After a number of years of rapid growth in demand, China is currently the world's largest consumer of steel, as well as being a large buyer of Rio Tinto iron ore.

Markets in the more developed countries are, however, generally more mature and, at a global level, the market for steel is growing at only one to two per cent a year. Demand for traded iron ore is growing rather faster. This reflects the concentration of steel production growth in Asia and the low availability of steel scrap in the region.

Iron is one of the most abundant elements in the earth's crust and there are few problems with long term availability of supply. Perhaps the greatest challenge presented by iron ore arises from the scale of its production and transportation. To keep the world's steel plants running, around a billion tonnes of iron ore are produced every year, with about half of this having to be moved by rail and sea.

This requires a massive exercise in materials handling and not one that invariably causes some impacts on areas surrounding the mines where iron ore is mined, and the ports from which shipping occurs. Considerable and systematic efforts have to be made by Rio Tinto to ensure that these impacts are well understood and effectively managed in consultation with the relevant local communities.

Further information can be found in the Hamersley Iron website.