MELBOURNE, July 16 (Reuters) - Rio Tinto (RIO.AX)(RIO.L) reported a 12% fall in quarterly iron ore shipments on Friday after storms affected its West Australian operations, but is expected to report bumper results this month on soaring prices for the steel raw material. Rio said it now expects to ship near the lower end of its range of 325 million tonnes (mt) and 340 mt in calendar 2021, meaning it may hand back its crown as the world"s biggest producer to Brazilian rival Vale S.A. (VALE3.SA). Vale, which reports output later this month, is on track to meet the upper end of its 2021 guidance of 315-335 mt, according to UBS. Rio shipped 76.3 million tonnes (mt) of the steel-making commodity for the three months ended June 30, down from 86.7 mt a year ago, just ahead of a UBS estimate of 76 mt. "We would have liked to have seen higher production to capitalise on these iron ore prices. Still, they are going to be swimming in cash at results time," said analyst David Lennox at Fat Prophets in Sydney. "Hopefully we will get a good dividend and we are looking for a share buyback as well." Iron ore prices surged to records above $230 a tonne in May thanks to a post-COVID infrastructure drive by China. Rio is expected to post half-year underlying earnings of $10.9 billion on July 28 according to a Vuma consensus of 14 analysts, more than double the $4.75 billion it reported for the same period last year. Rio (RIO.AX) on Friday also raised its full-year iron ore production cost guidance due to increased labour and input costs. The miner expects unit costs of $18.00-$18.50 per tonne for the year, up from its previous estimate of $16.70-$17.70 per tonne, even as prices it received for iron ore doubled to $168.40 a dry metric tonne free on board for the first half. Miners have been facing labour shortages as Australia has shut international borders and snap closed state borders. Rio also said it delayed commissioning at its new Gudai-Darri iron ore hub to later this year and first production from its Winu copper find in Australia to 2025 from original estimates of 2023, partly due to COVID restrictions. It lowered 2021 production by 2 Mt due to new strategies to protect Aboriginal areas of high cultural significance as it seeks to repair relations with Aboriginal groups following its destruction of rock shelters at Juukan Gorge last year.