Global iron ore markets rose sharply following a fatal incident at Rio Tinto’s (ASX:RIO) Simandou project in Guinea, prompting the company to suspend operations. The event pushed iron ore prices to their highest level in over a week amid concerns about supply disruptions and broader market factors influencing demand.

“All activity at the SimFer mine site is currently suspended, and support is in place for colleagues affected by this event,” the company said. 

Fatal Incident at SimFer Mine Site

The rise in prices followed an announcement from Rio Tinto that it had suspended all activity at the SimFer mine site, part of the larger Simandou iron ore project located in Nzérékoré, southeastern Guinea. The suspension was triggered by a fatal incident involving a contract worker. Details surrounding the circumstances of the incident have not yet been released.

In a statement, Rio Tinto confirmed the suspension and said, “All activity at the SimFer mine site is currently suspended, and support is in place for colleagues affected by this event.”

Simon Trott, who took over as Rio Tinto’s chief executive officer on Monday, is expected to visit the site. Trott also confirmed that the company will conduct a full investigation into the incident.

Project Overview and Timeline Disruption

Simandou is widely regarded as one of the largest undeveloped high-grade iron ore deposits in the world. Rio Tinto operates two of the four mining blocks through its SimFer joint venture, which includes China’s Chalco Iron Ore Holdings (CIOH) and the government of Guinea. The company had previously indicated that it expected first shipments from the site to begin in November 2025.

At full capacity, the mine is projected to produce nearly 120 million tonnes of high-quality iron ore annually, making it one of the most significant new sources of global supply. Initial shipments were expected to be modest as operations gradually ramp up.

The temporary shutdown of activity at SimFer has raised concerns about potential delays to this timeline, though no revised production schedule has yet been announced.

The fatality adds to a series of safety-related incidents involving Rio Tinto operations over the past two years. This is the seventh recorded death at Rio’s sites in that timeframe. Notably, a contractor was killed last October at the SimFer port site. In January of the same year, four employees died in a charter flight crash en route to the Diavik diamond mine in Canada. These incidents have interrupted what had previously been a five-year period without any fatalities at Rio Tinto’s managed operations.

Despite the operational setback in Guinea, broader market conditions are contributing to the current support for iron ore prices. In China, the top global consumer of iron ore, demand has remained firm, even amid environmental restrictions affecting steel production.

In the steelmaking hub of Tangshan, authorities have implemented temporary production curbs aimed at improving air quality in Beijing ahead of an upcoming military parade commemorating the end of World War Two. However, these restrictions have not significantly impacted consumption. According to consultancy firm Mysteel, average daily hot metal output — a key indicator of iron ore demand — remained steady at 2.41 million tonnes for the week ending August 21.

As of now, there is no confirmation on when operations at the SimFer site will resume. The pending investigation, to be led by Rio Tinto with expected collaboration from joint venture partners and local authorities, will be a determining factor.