How Rio Tinto is Streamlining Procurement and Supply Chain
Rio Tinto is accelerating efforts to advance its procurement strategy through a new streamlined operating model tailored to enhance supply chain dynamics across its mining operations.
Bidding to secure long-term shareholder value, Rio Tinto is focused on reorganising its framework around three pivotal product groups: iron ore, aluminium and lithium and copper.
The restructuring, effective immediately, aims to harness experienced leadership within each group to foster improved operational accountability and to optimally deploy resources where they can yield the most significant value.
Supply chain enhancement through integration
The cornerstone of this restructuring lies within Rio Tinto’s Iron Ore business, which now comes under the unified guidance of Chief Executive for Iron Ore, Matthew Holcz.
The move unites Rio Tinto’s current operations in Western Australia with the Iron Ore Company of Canada, alongside the upcoming Simandou project in Guinea once construction is complete.
By merging mature operating sites with emerging projects, Rio Tinto hopes to facilitate the exchange of safety best practices, the implementation of proven technologies and the transfer of expertise throughout its iron ore portfolio.
Simon Trott, who recently assumed the role of CEO, says: “A simplified business structure, grounded in our fundamental commitment to safety and with sharper focus on the most compelling opportunities we have, will enable us to deliver new standards of operational excellence and value creation.”
The restructure also seeks to reinforce the procurement that supports global steel production and infrastructure, creating a more robust, efficient supply chain.
Aligning processing industries
Further structural changes involve merging the company's lithium assets with its Aluminium business unit, now under the leadership of Jérôme Pécresse.
This new grouping comprises Atlantic Aluminium, Pacific Aluminium and Lithium, which aims to consolidate processing-driven commodities.
By learning from similar downstream challenges, Rio Tinto hopes to enhance productivity initiatives such as the Safe Production System.
This reconfiguration accounts for the dynamic nature of market demand, with lithium becoming more crucial in battery production, while aluminium remains integral in various industries, including transportation and construction.
By aligning these markets, Rio Tinto positions itself to adhere to increasing scrutiny over sustainability and ethical sourcing, thus providing greater transparency and management over these supply chains.
Focus on copper and essential minerals
The strategy retains copper as a standalone product group steered by Katie Jackson. This division remains committed to delivering output from the Oyu Tolgoi operation in Mongolia, stabilising the Kennecott operations in the US and developing new sources like the Resolution project and Nuevo Cobre in Chile.
Recognised for its vital role in the energy transition, copper demand is projected to soar, driven by its essential functions in electricity generation, transmission and storage.
Retaining copper within a distinct product group indicates Rio Tinto's dedication to meeting this critical mineral's demand while aiming to enhance project execution and operational constancy.
Outside of these product groups, the Borates and Iron & Titanium businesses shift to the oversight of the Chief Commercial Officer's portfolio for future strategic evaluation, with operations continuing uninterrupted.
Navigating leadership changes
Amid these structural overhauls, Rio Tinto acknowledges several executive transitions.
Sinead Kaufman will conclude her 28-year tenure with the company at the end of October 2025. Having started out as a geologist, she led strategic shifts including the transition out of coal and the establishment of lithium operations.
Meanwhile, the role of CEO Australia held by Kellie Parker will be succeeded by a new Head of Australia, focusing on stakeholder relations and partnerships.
Former Rio Tinto CEO Jakob Stausholm reflected on his tenure, summarising it as a pivotal period filled with both challenges and achievements, while crediting the teams and stakeholders involved in shaping Rio Tinto's trajectory.
Simon concludes: “We have delivered resilient results this year, remain on track to deliver strong mid-term production growth and continue to make progress against our objectives. Our focus now is on unlocking further shareholder value, putting both our capital and talent where it will deliver the greatest returns.”
