Rio Tinto PLC

Rio Tinto Group has agreed to acquire the Aurukun Bauxite Project in Western Cape York, Queensland, from a joint venture between Glencore and Mitsubishi Development. Financial terms were not disclosed, and the transaction remains subject to approval from the Queensland government and other Australian regulators. The acquisition would expand Rio Tinto's existing bauxite operations in the region, although Aurukun is still held under a Mineral Development License and has yet to receive a Mining Lease. Glencore said the joint venture had invested significantly in advancing the project's design, development and approvals and concluded that Rio Tinto's existing regional bauxite operations gave it the best opportunity to develop the resource. Traditional Owners, the Wik Waya people, have raised concerns about the adequacy of consultation, adding another potential hurdle to development. Rio Tinto shares were down about 0.7% at A$176.17 when Reuters reported the deal.

Canada could not fully meet U.S. aluminium import requirements even if it redirected all domestic production south of the border, Morgan Stanley said in a research note examining potential tariff relief. The United States relies on imports for about 80% of its aluminium consumption, with Canada historically its largest foreign supplier. During the first half of 2026, the U.S. imported 1.68 million tonnes, or about 280,000 tonnes per month, while Canada exported 1.16 million tonnes, averaging 192,000 tonnes per month and covering about 68% of U.S. import needs. Canadian production totalled nearly 1.6 million tonnes, equivalent to around 95% of American import requirements, meaning the U.S. would still need metal from other countries if every tonne produced in Canada were redirected there. Morgan Stanley assessed reports that Washington could reduce tariffs on some Canadian aluminium to 25% from 50%, a change that would encourage Canadian producers to send metal to the U.S. instead of Europe, where shipments enter duty-free. Still, the marginal tonne required by American buyers would come from a country facing the 50% tariff, and Morgan Stanley said the U.S. Midwest aluminium premium should continue to reflect that higher duty. The premium has traded about 30% above the implied tariff cost, partly reflecting competition with European buyers for Canadian metal, and reducing Canada's tariff could lower that competition and create modest downside for the Midwest premium. Morgan Stanley estimated that the premium could surrender roughly half its current excess over tariff-based fair value, equal to about 10 to 12 cents per pound. European premiums could receive near-term support if Canadian shipments move back toward the U.S., though recovering Middle Eastern supply may limit that impact. Further American supply could arrive under tariff discounts for companies expanding domestic capacity, with Emirates Global Aluminium and Century Aluminum planning a 750,000-tonne-per-year U.S. smelter.

Rio Tinto and the Western Australian Government have signed non-binding agreements for a proposed sale of their respective joint venture shares in the Dampier Seawater Desalination Plant to Yindjibarndi WaterCo. The plant, a 50:50 joint venture between Rio Tinto and the WA Government, has a construction budget of A$1.1 billion and is expected to provide 8 gigalitres of desalinated water into the West Pilbara Water Supply Scheme. A binding deal is targeted by the end of the year, with terms confidential and the sale price subject to construction costs and related factors. Construction of Stage 1, with a 4 gigalitre annual capacity, is expected to be completed this year with first water in early 2027, while Stage 2 construction has commenced and will add a further 4 gigalitres of annual capacity with first water expected in 2027. Rio Tinto will remain responsible for managing construction activities, with operational control proposed to transfer to Yindjibarndi WaterCo following construction completion, subject to a binding divestment agreement, due diligence processes and relevant approvals.

Rio Tinto Group is under fresh valuation scrutiny as a discounted cash flow estimate suggests the stock is 13.1% undervalued at £67.53 compared with a fair value of £77.68, while its price-to-earnings ratio of 14.8 times sits below industry and market benchmarks. The company’s diversification into battery metals such as lithium and copper through acquisitions and organic projects is expected to capture rising demand from electric vehicles and energy storage, potentially driving earnings and margin resilience. However, weaker iron ore and lithium pricing, along with higher leverage from expansion, could pressure returns. The stock’s recent one-month decline of 9.71% contrasts with a year-to-date gain of 12.81% and a one-year total shareholder return of 59.37%, highlighting mixed signals from cash flow and earnings multiples.