Rio Tinto boss Andrew Harding has expressed his disagreement to cutting production, saying it is not a solution to the lowering value of iron ore in the market. Instead, the mining giant will invite competitors into the market..

At a business function in Perth, Harding said that the company is likely to witness a hike in iron ore demand in the market to 3 billion tonnes per year by 2030. This will prompt a significant growth at the rate of two percent. When asked about Rio’s view on cutting production to better iron ore prices, the boss said that history itself taught not to opt for any such option as it was not a good one.

“If you think for one second that you can just take some volume out and no-one else will move to fill that volume then you’re fooling yourself,” he was quoted by the ABC. He said Rio Tinto has an experience of 50 years in the field, which is enough a reason to prove that cutting production won’t work for it, at least until the supply is controlled, which the iron ore giant does not wish to do.

“The ‘production at the right cost’ strategy I previously mentioned captures a number of separate themes, including lowest cost production. But it is also categorically about the absolute priority of safety and, in an expanded notion, the overall strength and resilience of our workforce,” Harding spoke at the event.

Pressure from comparatively smaller iron ore groups, including Atlas Iron, Fortescue Group, along with a push force from the State Government, has prompted Rio Tinto to enhance iron ore production in spite of the downing prices of the product. As a result, the company had to suffer from hiring high-cost miners and cutting WA’s royalty revenue.

Rio Tinto is the second largest iron ore producer around the globe and the leading manufacturer in the Pilbara region. Its overall yearly turnaround accounts to about 360 million tonnes.

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