Floods hamper Rio aluminium deliveries

Rio Tinto Ltd says Queensland's flood crisis is preventing some deliveries of aluminium from its giant Boyne smelter. Boyne Smelters Ltd, 59.4 per cent owned by Rio Tinto Alcan, is Australia's largest aluminium smelter, and is located near Gladstone in central Queensland.

Rio issued a force majeure, a contractual clause that gives companies the ability to miss deliveries due to circumstances beyond their control.

 

"The floods have cut road and rail access between Gladstone and Brisbane and the Brisbane port is closed, preventing deliveries to some domestic and international customers," Rio said in a statement.
"Rio Tinto Alcan is investigating alternative arrangements for customers, including shipping aluminium directly out of the Gladstone port.

"Rio Tinto Alcan is currently unable to provide an estimate of the full impact of the disruption to the supply of aluminium from Boyne Smelters Limited or the duration of the force majeure declaration," it said.

Last month Rio was forced to issue a force majeure for coal sales contracts from mines in which it has a majority interest in Queensland's Bowen basin. Queensland's flood crisis has seen at least 15 people perish and left thousands of homes flooded and without power.

Disclosure I am long RIO Shares