Analysis of Rio Tinto Mining Company

ECONOMICS1
Economics for business
By (Name)
Course
Instructor’s Name
Institutional Affiliation
The City and State
The Date

ECONOMICS2
Executive summary
This paper presents an analysis of Rio Tinto mining company in terms of its strategy in
the next five years. The paper illustrates that Rio Tinto is an Australian and United
Kingdom registered exploration and mining company. Australia, “Rio Tinto” is
considered to be among the fast developing mining companies. The company’s main
products include salt, iron ore, gypsum, uranium copper, and coal. Also, the paper
indicates that Rio Tinto operates in an oligopoly market structure which involved very
few companies. Further, the paper illustrates that Rio Tinto has an “inelastic demand for
its iron ore.” This is as a result of less sensitivity of the products demand to price
changes. Also, the paper indicates how the company has created an impact on the
“rampage of Cyclone Veronica” across the coast of Pilbara.

ECONOMICS3
Contents
Executive summary................................................................................................................................2
Introduction..............................................................................................................................................4
Industry background.............................................................................................................................4
Market structure......................................................................................................................................4
Factors that influence the demand for the company's product (s)............................................6
Factors that influence the supply for the company's product (s)...............................................7
Elasticity...................................................................................................................................................9
Impacts of an event on the industry/company..............................................................................10
Conclusion.............................................................................................................................................10
References.............................................................................................................................................11

ECONOMICS4
Introduction
The purpose of this paper is to make a world market report about Rio Tinto
mining company. In this case, we shall look at a detailed background of the company
such as its major aims, objectives, products, revenue, employees and many others. In
addition, the paper will describe the market structure of the company by illustrating its
leaders, their statistics and many others. In addition, the report will also consider the
demand side of the company in terms of demand elasticity for the products. Also, a brief
description of the event that has created a substantial impact on the industry will also be
explained in the people. In brief, the report covers a detailed structure of the company
(Rio Tinto) in terms of its revenue, contribution to the GDP of the company, employment
structure, and many others (Calibre 2014).
Industry background
Rio Tinto is an Australian and United Kingdom registered exploration and mining
company. The company is among the popular “mining companies “in the region. The
main products of Rio Tinto include salt, iron ore, gypsum, uranium copper, and coal. In
addition, the company processes some materials that is to say; bauxite into aluminum
and alumina, and "ore into iron". The by-products of the company include lead, silver,
and gold. The company was formed way back in 1873 by a syndicate of Matheson,
Deutsche, and Punchard, Clark, and company (Lilleyman 2013). Rio Tinto's executive
officers are located in Melbourne. The company is also made up of partly or wholly
subsidies, associated companies, and joint ventures. The major activities performed by
the company include processing, mining and finding mineral resources across the
world. The company covers over forty countries in 6 continents. By 2018 the company
had a revenue structure of US$ 56.036 billion. In addition, the company has over thirty-
five thousand employees across the world (Walsh 2009). The vision of the company is
to become a leading metal and mining company. As a way of achieving its vision, the
company aims at maximizing the returns of shareholders by sustainably developing,
processing and finding natural resources across the world. Also, the company has a
competent financial resource made up of innovation potential that leads to the
development influence the development of the responsive design to pursue the
company's strategy. As a result of an increase in the prices of commodities, market
demands and decreasing productivity of the workforce the company needs to make a
step into innovation. As a mining company, Rio Tinto's 44% sales are obtained from
exploration and extraction of "iron ore." The company has a large "market capitalization"
of US $27 billion making it the 2nd largest mining company in Australia ( Fantinel, &
Rusu 2013).
Market structure
Rio Tinto operates in an oligopoly market structure whereby the industry or
market is only dominated by very few large sellers. The mining sector of Australia is an
oligopolistic market as a result of collusion that results in reduced competition. In this
case, Rio Tinto operates in an oligopoly market structure because there are few sellers
whereby the demand for products is high and production is low. In addition, the
decisions made by the Rio Tinto company highly influenced by other firms (Lilleyman