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Rio Tinto, one of China’s largest iron ore suppliers, is confident that a recent pick-up in activity in the country’s manufacturing sector will be sustained despite a property slowdown.

Jakob Stausholm, chief executive of the Anglo-Australian miner, said the property sector remained “challenging”, but Chinese steel mills, the biggest market for Australian iron ore, were “producing flat out”.

He added that demand from China’s “seriously booming” infrastructure and automotive sectors would help offset lower demand from property.

“All in all there is a decent demand in China. We see that in the market, and I hope and believe it is not a short-term phenomenon,” said Stausholm, who went to China in November as part of Australian Prime Minister Anthony Albanese’s state visit.

Rio Tinto expects to spend about $10bn a year between 2024 and 2026, an amount which is markedly higher than over the past five years when spending has ranged between $5bn and $7.4bn. The miner will give more information on investing in new iron ore, copper and lithium projects at its investor day in Sydney on Wednesday.

Much of the increased spending will be dedicated to Simandou, a large high-grade iron ore mine it is developing alongside Chinese partners and the Guinean government.

Stausholm said the mine, which will account for 5 per cent of global supply when it is fully developed, was “close to approval” by the company and its partners. Rio has earmarked $6.2bn for the mine’s development.

Tyler Broda, an analyst with RBC, said the focus on the cost of Simandou’s development positioned the miner as a key player alongside its Chinese partners in the project, which is due to start production in 2025.

“The decision to maintain strong partnerships with key Chinese customers is a positive,” he said in a research note.

The company is also investing in its new Rhodes Ridge prospect — one of the largest undeveloped iron ore prospects in the world — in the Pilbara region in Western Australia, the Mongolian Oyu Tolgoi copper mine, increasing its aluminium output and developing its presence in lithium.

Stausholm said Rio was maintaining a measured approach to increasing its production of key metals such as iron ore and copper.

However, the company did lower its projected spend on decarbonisation to between $5bn and $6bn by 2030 from a previous target of $7.5bn. It said this reflected accounting changes on some investments and an upgrade to its truck fleet in the Pilbara due to occur next decade.

Some of Rio Tinto’s rivals, including BHP, Newmont and Glencore, have started hunting for acquisition targets as the world’s largest miners position themselves for future growth.

Stausholm said Rio would seek merger opportunities after buying out Turquoise Hill, the Canadian investor in Oyu Tolgoi, and its purchase of a stake in aluminium recycling company Matalco.

“The last thing we need is very big M&A because it is disruptive and it takes you off course,” he said.