Shares in mining behemoth Rio Tinto have soared to an unprecedented peak, propelled by a massive and initially controversial wager on lithium made by its former chief executive.
The Record-Breaking Surge
On Monday, the Anglo-Australian miner's stock broke through the $150 barrier on the ASX for the first time in history. It closed the session at $149.59, marking a daily gain of $1.90. This milestone caps off an impressive 12-month run, with Rio's share price climbing 30 per cent over the past year.
The rally is underpinned by a dual engine: a powerful resurgence in demand for lithium, a critical battery metal, and iron ore prices that have stubbornly remained above $US100 per tonne, defying earlier market forecasts.
Stausholm's Counter-Cyclical Masterstroke
The foundation for this success was laid in March last year by then-CEO Jakob Stausholm. In a bold move, he steered Rio Tinto to complete the $11 billion acquisition of Arcadium Lithium. The deal was struck when lithium prices were languishing, with spodumene concentrate trading at less than $US850 per tonne.
Mr Stausholm further committed billions to develop the company's broader lithium portfolio. However, the strategy faced immediate headwinds as lithium prices plunged further, with spodumene concentrate sinking below $US600/t by June 2025. This downturn tested the board's patience, leading to Stausholm's replacement by Simon Trott in July 2025.
The Lithium Rebound and Strategic Refocus
The tide turned dramatically in the final quarter of 2025. Lithium prices rebounded sharply, now sitting above $US1550/t. This surge was fuelled by mine closures in China and skyrocketing demand for battery commodities, particularly for energy storage systems like the Tesla Powerwall.
Under new leadership, Rio Tinto has refined its lithium strategy. Simon Trott stated in October that the company would only advance "the very best" of its many lithium projects, setting an exceptionally high bar. He subsequently scrapped the contentious Jadar project in Serbia and effectively closed the door on restarting the mothballed Mt Cattlin mine in Western Australia.
Rio's lithium focus is now concentrated on brine operations in South America and battery-grade processing plants in Asia and North America.
This strategic pivot into lithium sets Rio apart from its main Pilbara iron ore rivals, BHP and Fortescue, which have no lithium exposure. Both companies are currently trading well below their own historical share price peaks.
The lithium sector's revival has ignited ASX-listed producers, with stocks like Pilbara Minerals (PLS) and Liontown Resources more than doubling in value since September.
Despite the share price celebration, Rio Tinto is not without internal challenges. Mr Trott indicated in the latter half of last year that the company must take a hard look at reducing organisational layers and improving cost efficiency, signalling a wave of white-collar job cuts is on the horizon for the dual-listed giant.
