Hard coking coal output was up 40% compared to the 2007 third quarter, while thermal coal production rose 8%.

The port constraints experienced by Queensland producers in the third quarter of last year eased, allowing operations to boost output.

Higher production was also achieved at the Kestrel longwall following “focused operational improvements”. Kestrel produced 1.3 million tonnes. Blair Athol was the biggest producer with 2.5Mt.

In the Hunter Valley semi-soft coal output increased, taking advantage of stronger pricing. Rio said vessel queues in New South Wales reduced allowing production to come into line with port allocations.

Record production from US coal mines, up 13%, was achieved, with demand strong for Power River Basin product. This was supported by incremental expansion of Rio Tinto Energy America’s mines.

Rio said coal shipments also recovered from the severe weather conditions experienced in the second quarter.

Jacobs Ranch was the biggest individual producer with a whopping 10.8Mt for the quarter.

Looking at the bigger picture, Rio said in the wake of the financial crisis the company was reviewing the timeline for the announcement of the first $10 billion of previously announced divestments.

“The long-term outlook for Rio Tinto remains positive despite the upheavals in global markets,” Albanese said.

He said in the near term, the Chinese economy was “pausing for breath” and China would feel the impact of the global slowdown.

“However, the near-term slowdown of growth is substantially due to tightening of monetary policy introduced by the Chinese government last year in order to tackle inflation,” Albanese said.

“With our cost-competitive assets, resilient margins and strong customer base, Rio Tinto is well placed to weather the current economic weakness.

“Against the backdrop of the current markets, the group is taking the opportunity to review the near-term spending timelines and project costs of its capital expenditure program, while preserving the optionality of its high-quality growth pipeline overall.”

Shares in Rio Tinto were down 13% in midday trade at $A68.32.