Iron ore - spot market 2008

Rio Tinto PLC
18 December 2007

Rio Tinto to place up to 15 million tonnes of iron ore into the spot market in
2008



18 December 2007



Rio Tinto has announced plans to place up to 15 million tonnes of iron ore into
the spot market in 2008.



Rio Tinto announced at its Investor Seminar on 26 November 2007 that it is
planning substantial expansions of capacity over the next decade in its Western
Australia Pilbara operations. This will allow the Group to place substantially
more tonnage on to the higher-priced spot market while continuing to meet
longer-term contractual commitments.



Rio Tinto has been active in the spot market during 2007 and in December sold
one million tonnes at US$190 per tonne. A similar volume has been sold for
January shipment at an average price of US$187 per tonne.  This compares with
the current equivalent benchmark price of US$85 per tonne (FY2007 FOB benchmark
plus spot freight).



'The iron ore market is changing', said Tom Albanese, chief executive of Rio
Tinto. 'Customers are demanding more transparency in pricing and more tonnes,
faster than ever before.  Our industry-leading growth pipeline in iron ore puts
us in a strong position to benefit from stronger prices, now and in the future.'



Sam Walsh, Rio Tinto's chief executive Iron Ore, said, 'The bulk of Rio Tinto's
Pilbara capacity is committed under long term contracts and Rio Tinto will
continue to honour these contracts. At the same time the gap between the
benchmark and spot prices is huge and we intend to continue to take advantage of
those higher prices'.



Mr Walsh said the iron ore market was extremely tight. 'We produce more tonnes
at lower cost, from locations closest to the growth iron ore markets. We believe
in competitive and transparent pricing, and our production expansion plans give
us the capacity to supply all of our markets and allow us to agree prices for
all durations.'



This announcement follows the 26 November 2007 Investor Seminar outlining Rio
Tinto's conceptual pathway to iron ore production of more than 600 million
tonnes per year, including 420 million tonnes a year from the Pilbara.



At that time Rio Tinto also announced a US$2.4 billion commitment to develop the
Mesa A and Brockman 4 iron ore deposits in the Pilbara, as well as outlining
plans to increase the potential capacity of its Simandou iron ore project in
Guinea (West Africa) to 170 million tonnes per year.



The existing Pilbara rail and port infrastructure secures Rio Tinto's position
as the premier Australian iron ore supplier, allowing it to reap maximum benefit
from a strong pricing outlook, Mr Walsh said. 'We own and operate three ports in
two locations, and we have the capability to expand these facilities well beyond
the existing levels.'




Notes to editors:



Rio Tinto believes that efficient short, medium and long term contracts need to
exist in the iron ore industry.  At its Investor Seminar on 26 November 2007,
Rio Tinto outlined its intention to operate a mix of three pricing approaches:

•   Short-term spot sales;

•   Hybrid contracts - which are based around a frequent pricing
    adjustment to reflect fair market value.   As at November 2007, Rio Tinto 
    had signed some 6.5 million tonnes per annum of hybrid contracts; and

•   Long-term contracts with regular re-pricing.



By way of sensitivity, the current difference between the spot iron ore price
and the price of iron ore delivered pursuant to 2007 term contracts is about
US$100 per tonne.  On 15 million tonnes this would equate to US$1.5 billion of
revenue before tax



This announcement is one component of this approach.





About Rio Tinto



Rio Tinto is a leading international mining group headquartered in the UK,
combining Rio Tinto plc, a London listed company, and Rio Tinto Limited, which
is listed on the Australian Securities Exchange.



Rio Tinto's business is finding, mining, and processing mineral resources. Major
products are aluminium, copper, diamonds, energy (coal and uranium), gold,
industrial minerals (borax, titanium dioxide, salt, talc) and iron ore.
Activities span the world but are strongly represented in Australia and North
America with significant businesses in South America, Asia, Europe and southern
Africa.



Forward-Looking Statements



This announcement includes 'forward-looking statements' within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All statements other than
statements of historical facts included in this announcement, including, without
limitation, those regarding Rio Tinto's financial position, business strategy,
plans and objectives of management for future operations (including development
plans and objectives relating to Rio Tinto's products, production forecasts and
reserve and resource positions), are forward-looking statements. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
Rio Tinto, or industry results, to be materially different from any future
results, performance or achievements expressed or implied by such
forward-looking statements.



Such forward-looking statements are based on numerous assumptions regarding Rio
Tinto's present and future business strategies and the environment in which Rio
Tinto will operate in the future. Among the important factors that could cause
Rio Tinto's actual results, performance or achievements to differ materially
from those in the forward-looking statements include, among others, levels of
demand and market prices, the ability to produce and transport products
profitably, the impact of foreign currency exchange rates on market prices and
operating costs, operational problems, political uncertainty and economic
conditions in relevant areas of the world, the actions of competitors,
activities by governmental authorities such as changes in taxation or regulation
and such other risk factors identified in Rio Tinto's most recent Annual Report
on Form 20-F filed with the United States Securities and Exchange Commission
(the 'SEC') or Form 6-Ks furnished to the SEC. Forward-looking statements
should, therefore, be construed in light of such risk factors and undue reliance
should not be placed on forward-looking statements. These forward-looking
statements speak only as of the date of this announcement. Rio Tinto expressly
disclaims any obligation or undertaking (except as required by applicable law,
the City Code on Takeovers and Mergers (the 'Takeover Code'), the UK Listing
Rules, the Disclosure and Transparency Rules of the Financial Services Authority
and the Listing Rules of the Australian Securities Exchange) to release publicly
any updates or revisions to any forward-looking statement contained herein to
reflect any change in Rio Tinto's expectations with regard thereto or any change
in events, conditions or circumstances on which any such statement is based.



Nothing in this announcement should be interpreted to mean that future earnings
per share of Rio Tinto plc or Rio Tinto Limited will necessarily match or exceed
its historical published earnings per share.



Subject to the requirements of the Takeover Code, none of Rio Tinto, any of its
officers or any person named in this announcement with their consent or any
person involved in the preparation of this announcement makes any representation
or warranty (either express or implied) or gives any assurance that the implied
values, anticipated results, performance or achievements expressed or implied in
forward-looking statements contained in this announcement will be achieved.




For further information, please contact:
Media Relations, London                             Media Relations, Australia

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Media Relations, US

Nancy Ives


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Investor Relations, London                          Investor Relations, Australia

Nigel Jones                                         Dave Skinner

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                                                    Investor Relations, North America

David Ovington                                      Jason Combes

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Email: [e-mail]


Website: www.riotinto.com

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