Rio Tinto has reported lower earnings on overall weakness in commodity prices but generated a boost to performance from an easing of energy costs.

The world’s biggest iron ore producer reported on Wednesday underlying earnings of $US23.9 billion ($A36.4 billion), down nine per cent, and net cash from operating activities of $US15.2 billion ($A23.2 billion), a six per cent fall.

Capital investment guidance was unchanged at up to $US10 billion ($A15.2 billion) per year in 2024, 2025 and 2026, the company said.

Rio Tinto said it expected to pay about $US1 billion ($A1.5 billion) per year on closure activities – up from $US800 million ($A1.2 billion) in 2023 –   at the Gove alumina refinery, Argyle, Energy Resources of Australia and legacy sites.

“We will continue paying attractive dividends and investing in the long-term strength of our business as we grow in the materials needed in for a decarbonising world,” chief executive Jakob Stausholm said.

Net earnings were $US10.1 billion ($A15.3 billion) after a $US700 million ($A1.1 billion) impairment charge mainly relating to Australian alumina refineries.

The resources heavyweight said it saw generally lower prices for commodities as supply improved and outpaced “modest” demand growth.

But there was a boost to underlying earnings from an easing of energy costs, including lower diesel prices for the Pilbara iron ore operations and lower energy bills at alumina refineries and aluminium smelters.

While inflation has eased, Rio Tinto said it continued to see lag effects in its impact on contractor rates, parts and some raw materials, which was expected to stabilise in 2024.

Rio Tinto said iron ore shipments and bauxite production guidance remain subject to weather impacts, with Pilbara iron ore costs rising on labour costs and parts inflation in Western Australia.

Copper unit costs were expected to fall in 2024, driven by higher volumes at Oyu Tolgoi as the underground operations continue to ramp up and at Kennecott where refined copper volumes are expected to increase with the smelter rebuilt.

The company declared a higher fully franked final dividend of $A3.93 for a total of $A6.54 in 2023, after slashing dividends a year ago as weak demand in China hit profits.

This post was originally published on Michael West.