Rio Tinto will buy back $US1.7b of its 2018 bonds

Rio Tinto Group will repurchase about $US1.7 billion of bonds, its second buyback in about two months, as it seeks to cut debt, according to the Sydney Morning Herald.

The world's second-largest mining company is buying back $US943 million of 6.5% notes due in July 2018 and $US804 million of 2.25% securities maturing in December the same year, both at premiums to their face value, according to a statement from the company on Tuesday.

Rio Tinto said it may buy as much as $US3 billion of debt, starting with the 2018 notes. Holders of bonds due 2020, 2021 and 2022 still have until July 5 to tender.

Pressure on lower grade iron ore miners as discount widens

A big drop in the iron ore price in the last month has been compounded by a sharp increase in the discount on lower grade iron ore sold by Fortescue Metals Group and Australia's junior iron ore miners, according to the Australian Financial Review.

Shaw and Partners analyst Peter O'Connor said he had been tracking the spread of the discount for about five years and the current levels were about as bad as it got for the sector's marginal higher cost, lower grade producers.

“Adjusting for grade and adjusting for quality is hurting these guys,” O'Connor said.

Arrium players talk sale tactics

Arrium receiver KordaMentha and adviser Deutsche Bank will run two separate sales processes; one for the whole company and one for its prized division, Moly-Cop, according to the Australian Financial Review.

The Arrium camp convened at the steelmaker's office in the Sydney suburb of St Leonard's on Tuesday, to nut out the strategy on how best to proceed with the pending sales.