NEW YORK (TheStreet) -- Rio Tinto's (RTP) global iron ore production fell 2% during the second quarter from a year earlier.

During the quarter, Rio Tinto's production of alumina, bauxite, and hard coking coal increased 5%, 1%, and 26%, respectively on a year-on-year basis. In contrast, mined copper, refined copper and uranium output declined by 19%, 11% and 28%, respectively. Mined gold and mined silver output were down 34% and 28%, respectively, whereas refined gold and refined silver output were up 30% and 20%, respectively.

Most of the company's operations continued to run at full capacity, thanks to strong demand growth.

"2010 continues to shape up well for Rio Tinto and we are driving our operations at close to capacity. Markets for most of our products are strong and the overall long-term demand outlook is positive," said Rio Tinto CEO Tom Albanese, in a statement Wednesday. "But in recent weeks, fears about a possible double-dip recession in OECD countries and a slight slowdown in Chinese growth have led to some weakening in sentiment. We believe this pattern of volatility in the global economy is set to continue."

The company maintained its 2010 iron ore production guidance at 234 million tons, year-on-year growth of 7.6%. Guidance for refined copper production also was maintained at 380,000 tons. The company raised guidance for mined copper production to 690,000 tons from the guidance of 680,000 tons it issued in April.

Meanwhile, 2010 guidance for alumina production was reduced for 9.4 million tons from 9.6 million tons, as the company cut back production during the second quarter at the Vaudreuil refinery on a drop in aluminum prices.

The company will continue its expansion projects in Australia on the rollback of mining taxes.

"Growth is firmly back on our agenda. We have a large range of options for expansion and investment competing for capital. Now that much of the uncertainty over the Australian resource tax has been removed, we are starting to move ahead with projects there with the announcement today of $200 million of funding to prepare for the expansion of our Pilbara operations to 330 million tons a year," Albanese said.

Shares of Rio Tinto and BHP Billiton ( BHP) closed higher by 1.25% and 2.07%, respectively, in Australia.

At $47.55 in New York, Rinto is currently trading at an attractive price-to-earnings multiple of 7.3, lower than BHP's 14.4, Vale's ( VALE) 8.1, Alcoa's ( AA) 23.1 and Freeport-McMoRan Copper & Gold's ( VALE) 8.4.

Karvy Global Services (www.karvyglobal.com), a subsidiary of the Karvy group (www.karvy.com), provides specialized research in asset classes including stocks, mutual funds and insurance to leading Wall Street firms.

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