Rio Tinto coal and copper boss Jean-Sebastien Jacques says thermal coal prices are likely to stay depressed for five to seven years but copper could stage a recovery in two years.
Thermal coal is languishing near US$51 ($70) a tonne, down 20 per cent this year, and a huge drop on the $US150 a tonne it was trading at during the peak of the boom in 2011.
Metallurgical coal prices, like thermal coal, also had “a long way to go” before there was any light at the end of the tunnel, Mr Jacques said.
Rio Tinto has been readying to bow out of coal, restructuring its Hunter Valley business and kicking off its staggered exit two months ago with the $US606 million ($867 million) sale of a minority stake in Bengalla, one of its three mines in the New South Wakes region, to New Hope Group.
But Mr Jacques would not be drawn on Rio’s sales process, saying “all assets in Rio Tinto are for sale at the right price”.
“Our strategy is not about copper, coal or iron ore – it’s all about tier-one assets in those commodities.”
“Anything not tier one is regarded as non-core, and unless we can extract good value for them [tier-one assets], we are not going to sell them. It is not a fire sale.”
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