AAP reported that Rio Tinto's aspiration of producing 360 million tonnes of iron ore each year is achievable despite concern about its Pilbara expansion.

Analysts said that the mining giant has been showing analysts around its port, rail and mine operations in the north of Western Australia this week and some believe Rio's cost cutting targets for its iron ore business are very conservative.

Rio has targeted a reduction of USD 5 billion in its overall operating cost cuts by the end of 2014. It is also yet to decide on allocating a further USD 5 billion on an iron ore expansion to achieve 360 million tonnes a year.

Mr Glyn Lawcock analyst of UBS believed that the company will achieve that tonnage target after this week commissioning a stage of its expanded port, rail and mine operations that will increase output to 290 million tonnes a year. That is up from expected production of 265 million tonnes in 2013.

Mr Lawcock said that "It will happen. It's not a case of when, it's just a case of how. They'll ultimately get to 360 million tonnes. The target should be achieved by expanding the existing assets beyond that 290 million tonnes per year, pushing assets harder and developing one or two new mines.”

The Rio Tinto board is expected to make a decision on the 360 million tonne expansion by the end of the year. Given that the company has already invested more than USD 3.5 billion in infrastructure, Mr Lawcock believes the board is unlikely to wait much longer to approve the expansion. Doing nothing is always an option, but a highly unlikely option.