Rio Tinto PLC said iron-ore output increased 5% in the third quarter of the year after the company expanded its Australian mining operations even in the face of falling prices.

Rio Tinto—the world’s second-largest producer of iron ore, after Brazil’s Vale —is angling to win a greater share of the iron-ore export market, saying the size of its operations in the remote northeast of Australia allows it to produce ore at a significantly lower cost than its competitors.

The miner, which relies on the commodity for most of its earnings, has defended itsdecision to keep increasing production, a strategy analysts say has helped push the price of iron ore down by about 40% this year to multiyear lows.

The Anglo-Australian miner said Wednesday that third-quarter iron-ore production at the mines it operates rose 5% from the second quarter to 76.8 million metric tons in the third quarter. Output was 12% higher than in the same period a year earlier.

Rio Tinto reiterated expectations that it would produce 295 million tons of iron ore globally this year, including output from its Canadian operations. In addition, it said it intends to sell around 5 million tons of extra ore from its own stockpiles.

Rising supply from Australian mines, including those operated by rivals BHP Billiton Ltd. and Fortescue Metals Group Ltd. , flooded the seaborne iron-ore market this year, dragging prices sharply lower.

Rio Tinto has been expanding its mines in the Pilbara region in a bet that China will continue to need vast quantities of iron ore to make steel for its skyscrapers and for industries such as auto manufacturing. China buys three in every five tons of iron ore shipped by global mining companies.

“If we don’t fill that void, somebody else will,” Andrew Harding, chief executive of Rio Tinto’s iron-ore division, said last week. “It is a harsh reality of a competitive, international marketplace.”

In its quarterly report, the company said copper output was slightly higher on-year, rising 1% to 151,800 tons as production rose at Escondida—the world’s largest copper mine in Chile, owned jointly with BHP Billiton Ltd. and a Japanese consortium led by MitsubishiCorp.

Rio Tinto said it now expects to produce more copper this fiscal year, increasing its guidance to investors to 615,000 tons of mined copper from 585,000 tons previously. Those figures relate to its own share of mined copper, excluding the share of joint-venture partners.

The company also reported a 3% on-year decline in the production of bauxite, used to make aluminum, to 10.9 million tons in the third quarter. Hard coking coal output was down 14% on-year at 1.9 million tons, it said.