RioTinto will hand investors the largest dividend in its 148-year history as it cashes in on the current mining boom.
The company will pay out £6.5billion, equal to 400p per share, after a surge in the price of steelmaking ingredient iron ore boosted profits by more than a third.
Iron ore rose in value by almost 85 per cent last year, as demand rocketed from China’s steel industry. The country has been stockpiling the commodity as it plans to unleash a post-Covid economic boom.
The results have added to growing speculation that the market is entering another ‘supercycle’ that will see the prices of commodities soar.
A construction boom in China, a huge economic stimulus package in the US, green policies and lower stocks of commodities are all forecast to bolster prices for years to come.
Rio Tinto’s profits for 2020 rose by almost 40 per cent to £11.1billion.