Rio Tinto Limited (RIO) reported record quarterly production in iron ore, bauxite, hard coking coal and US coal. The company said its long-term outlook remained positive despite the upheavals in global financial markets.

Chief executive Tom Albanese said due to its cost competitive assets, resilient margins and strong customer base, Rio Tinto was well placed to weather the current economic weakness.

"Against the backdrop of the current markets, the group is taking the opportunity to review the near term spending timelines and project costs of its capital expenditure programme, while preserving the optionality of its high quality growth pipeline overall," Mr Albanese said.

Rio said all the previously announced divestment processes were underway and were continuing.

"The primary objective continues to be obtaining appropriate value from the assets highlighted for divestment," Mr Albanese said.

"Acknowledging the reality of the currently challenging financial markets, the group is reviewing its timeline for the announcement of the first US$10 billion of divestments, which was due to be made in 2008."

Mr Albanese also addressed concerns about China's near term growth prospects in the wake of recent financial market turmoil. He said the Chinese economy was pausing for breath.

"China is not completely insulated from an OECD recession and we will see an impact on Chinese exports," he explained.

But Mr Albanese noted that the recent slowdown of growth was mostly due to tightening of monetary policy introduced by the Chinese government last year in order to tackle inflation.

"Furthermore, we expect third quarter economic data to show an exaggerated slowdown, reflecting the postponement of projects during the Olympics," he added.

"Looking further out, Chinese GDP will remain largely driven by the domestic economy and we expect industrialisation and urbanisation to continue apace with strengthening."

Looking back to its third quarter production results, Rio said global production of iron ore was up 17% compared to the same time last year.

The increase was driven by record quarterly iron ore production in Australia of 48 million tonnes, up 20% compared with the third quarter of 2007.

"Rio Tinto Alcan continued to perform well with bauxite production up 93%, alumina up by 222% and aluminium up by 371%, compared with the third quarter of 2007, reflecting the acquisition of Alcan in the fourth quarter of 2007," the company added.

However, the proforma comparisons painted a more subdued picture. On a proforma basis the respective increases for bauxite and alumina were 11% and 2%, while aluminium declined by 1%, primarily due to temporary cutbacks at Tiwai Point.

Rio said it experienced an overall decrease in mined copper by 7% compared with the third quarter of 2007.

"Strong recovery in grades at Kennecott Utah Copper was offset by a decline at Escondida, which experienced operational interruptions," the company said.

Rio said its hard coking coal and thermal coal operations achieved strong results with with third quarter production up by 40% and 8% compared to last year's corresponding period.

The miner said it achieved record production for the US coal business, up 13% on the third quarter of 2007.

Uranium production increased 13%.

Meanwhile, Rio Tinto subsidiary Coal & Allied Industries Limited (CNA), said its third quarter coal production was 4.41 million metric tons, in line with the previous corresponding period.

The company said coal production was 8% lower than in the second quarter and had been affected by the annual coal preparation plant maintenance shut down and higher stripping ratios.

The proportion of semi soft coking coal production was in line with the June quarter and the miner said it continued to act to take advantage of the stronger semi soft market. Coal sales for the quarter were up 2% on year to 4.6 million tons.

Rio Tinto shares closed down $4.30 or more than 5% at $78.50, Coal & Allied shares were steady at $92.60. – Egoli