Glencore – Page 20 – Republic of Mining

Glencore hails strongest full-year results after commodity rally – by Barbara Lewis and Arathy S Nair (Reuters U.K. – February 21, 2018)

February 21, 2018

https://uk.reuters.com/

LONDON/BENGALURU (Reuters) – Glencore Chief Executive Ivan Glasenberg hailed the group’s results as its “strongest on record” on Wednesday, bolstered by a recovery on commodity markets and said it had the assets to meet future demand including from electric vehicles.

In line with other miners reporting this month, Glasenberg said there were “emerging inflationary pressures,” but they had been offset so far by strong prices for byproducts, such as cobalt, and Glencore was able to contain costs.

Glencore’s shares rose around 4 percent by 1045 GMT, outperforming the broader index. After outstripping its rivals last year, Glencore’s share price has lagged in 2018, hit by concerns about instability in Democratic Republic of Congo where it has major operations.

Apple in Talks to Buy Cobalt Directly From Miners – by Jack Farchy and Mark Gurman (Bloomberg News – February 21, 2018)

February 21, 2018

https://www.bloomberg.com/

Apple Inc. is in talks to buy long-term supplies of cobalt directly from miners for the first time, according to people familiar with the matter, seeking to ensure it will have enough of the key battery ingredient amid industry fears of a shortage driven by the electric vehicle boom.

The iPhone maker is one of the world’s largest end users of cobalt for the batteries in its gadgets, but until now it has left the business of buying the metal to the companies that make its batteries.

The talks show that the tech giant is keen to ensure that cobalt supplies for its iPhone and iPad batteries are sufficient, with the rapid growth in battery demand for electric vehicles threatening to create a shortage of the raw material. About a quarter of global cobalt production is used in smartphones.

As mining investors push caution, Glencore differs from rivals – by Susan Taylor and Melanie Burton (Reuters U.S. – February 16, 2018)

February 16, 2018

https://www.reuters.com/

TORONTO/MELBOURNE (Reuters) – As shareholders push the world’s cash-rich miners to maintain lush dividends and make the most of existing assets, Glencore is taking a slightly different tactic that positions it for shrewd acquisitions.

Like other big rivals, Glencore is expected to lift its dividend payout when it reports results next week, but the Swiss miner and trader is also “open for business” when it comes to buying mines or companies, its chief financial officer said in December.

“Glencore’s deal-making is now very strategic. They’re trying to find businesses with the highest margin and get into sectors where they will have a competitive advantage,” said David Neuhauser, managing director of Livermore Partners, which holds Glencore shares.

Glencore flags sharp rise in cobalt production – by Neil Hume (Financial Times -January 31, 2018)

February 1, 2018

https://www.ft.com/

Cobalt prices have soared amid rising demand for batteries to power electric vehicles

Glencore, the Swiss miner and commodity trader, has flagged a big increase in cobalt production as one of its biggest copper mines restarts production.

The London-listed group said it expected to produce around 39,000 tonnes of the metal this year, up from 27,400 tonnes last year, as its Katanga mine in the Democratic Republic of Congo come back on stream following a big investment programme.

The mine was closed in 2015 so that Glencore could upgrade its processing facilities. The company estimates it could produce as much as 20,000 tonnes of cobalt a year by 2019.

Asia powers demand for thermal coal – by Neil Hume (Financial Times – January 8, 2018)

January 9, 2018

https://www.ft.com/

Price of fossil fuel used for electricity reaches highest level since late 2016

Thermal coal, the least loved major commodity, has jumped to its highest level since late 2016 as strong manufacturing activity in Asia and appetite from China drives demand.

Thermal coal is burnt to generate electricity, and is a big source of income for miners such as Glencore, Whitehaven and Yancoal, which produce material for the seaborne market.

While the fossil fuel is being phased out in Europe on environmental grounds, it still accounts for about 40 per cent of energy consumption in emerging markets.

Newsmakers of 2017: Glencore CEO, Ivan Glasenberg – by David McKay (Miningmx – December 28, 2017)

January 2, 2018

https://www.miningmx.com/

IN December, Ivan Glasenberg’s Glencore appointed former South African Reserve Bank governor, and ANC stalwart, Gill Marcus, to its board fuelling speculation the group might be turning its attention to future South African opportunities.

The likelihood is this appointment adds to board diversity and its brains trust, but as far as common-and-garden tittle-tattle goes, why not speculate further on Glencore’s apparently unfettered ambition to extend its production and trading base? Without doubt, the firm has been the most bullish of the world’s diversified miners in respect of where the market is heading – a view predicated on its recent transactional history.

The emergence of ‘electric vehicles’ as a new major source for industrial metal demand has also pepped up spirits, especially Glasenberg – although one is duty-bound to question why he is making such a big fuss about it now considering it’s probably been in Glencore’s folder of cracking strategy ideas for quite a while.

How Batteries Sparked a Cobalt Frenzy and What Could Happen Next – by Mark Burton (Bloomberg News – December 17, 2017)

December 18, 2017

https://www.bloomberg.com/

Cobalt left other metals in the dust this year, driven by demand from electric carmakers like Tesla Inc. But with new supply coming online and high prices likely to spur substitution and recycling, the market for the key battery component could prove choppier next year. Here are five themes that will capture the market’s attention in 2018.

Record Prices

After prices more than tripled in the past two years, cobalt has become a valuable prize for the handful of miners producing it at scale. The global market has increased from about $4 billion a year at the end of 2016 to about $8 billion now and is roughly equal in size to the tin market.

But cobalt could be set to level out in 2018. BMO Capital Markets sees prices averaging about $68,200 a ton from about $72,000 now as Glencore Plc and Eurasian Resources Group ramp up major new projects in 2018 and 2019.

COLUMN-As Glencore restarts capacity, is time up for zinc rally? – by Andy Home (Reuters U.S. – December 14, 2017)

December 14, 2017

https://www.reuters.com/

LONDON, Dec 14 (Reuters) – When Glencore announced it was curtailing 500,000 tonnes of capacity at its zinc mines in October 2015, the price of three-month zinc on the London Metal Exchange was $1,700 per tonne.

The price is now $3,175 per tonne, hovering within striking distance of last month’s 10-year high of $3,326. Glencore can’t take full credit for the bull surge of the last two years but its curtailments acted as a powerful accelerator to a structural shift towards supply deficit.

So what happens next, now the company has just announced the first restart at the Lady Loretta mine in Australia? The market seems unfazed. Indeed, LME zinc rallied on the news, the bear sting masked by a headline decline in forecast production next year.

Glencore Is the Devil on Mining’s Shoulder – by David Fickling (Bloomberg News – December 12, 2017)

December 13, 2017

https://www.bloomberg.com/

The mining industry these days resembles that old cartoon about a person torn between prudence and temptation.

On one shoulder, a white-clad angel is whispering about the virtues of capital discipline, shareholder value and generous dividends. On the other sits Glencore Plc Chief Executive Officer Ivan Glasenberg, clad in red and promising to buy or build everything in sight.

The reason for that contrast was laid out clearly at the start of a Glencore investor presentation Tuesday. Uniquely among its peers, Glencore derives a substantial slice of its earnings from trading commodities, rather than producing them. When mining is weak, marketing can take up the slack, and vice versa, as this company chart shows:

Glencore sees battery minerals powering profit in 2017 and beyond – by Barbara Lewis and Arathy S Nair (Reuters U.K. – December 12, 2017)

December 13, 2017

https://uk.reuters.com/

LONDON (Reuters) – Miner and trader Glencore (GLEN.L) said on Tuesday its battery minerals, especially cobalt, should spur profit in 2017 and beyond in an update for investors that also promised to grow the business, especially through partnerships.

It said its marketing, or trading, division’s 2017 EBIT (earnings before interest and tax) would be at the top end of its previous guidance at $2.8 billion, steady from 2016 but effectively an increase given that Glencore sold half of its agriculture business last year.

The company also issued full-year 2018 overall EBITDA (earnings before interest, tax, depreciation and amortisation) guidance of $16.2 billion, slightly below some analysts forecasts, but higher than Glencore’s guidance for full-year profit this year of $15 billion.

Glencore to Double Cobalt Output on Electric Vehicle Demand – by Thomas Wilson (Bloomberg News – December 12, 2017)

December 12, 2017

https://www.bloomberg.com/

Glencore Plc will double its production of cobalt in the next two years, tightening its grip on the market for the key battery component of electric vehicles.

The Swiss commodity giant’s Toronto-listed Katanga Mining Ltd. in the Democratic Republic of Congo will produce as much as 34,000 tons in 2019, Katanga said Monday. That compares with the 20,000 tons-a-year guidance Chief Executive Officer Ivan Glasenberg gave in August and could give Glencore control of about 40 percent of world supplies, according to current data.

Glencore, which mines products from coal to zinc and trades some 100 raw materials, is zeroing in on cobalt after prices more than doubled this year on demand from automobile and battery manufacturers.

Congo mines say revised code threatens industry’s future (Reuters U.S. – December 11, 2017)

December 12, 2017

https://www.reuters.com/

DAKAR, Dec 11 (Reuters) – Mining companies in Democratic Republic of Congo said on Monday that proposed changes to the mining code adopted by the lower house of parliament last week would do lasting damage to investment in Africa’s top copper producer.

The process of revising the 2002 mining code in Congo has dragged on for over five years but the National Assembly on Friday approved a bill that would increase taxes and royalties and sent it to the upper house Senate for a second vote.

The measure would also increase the state’s minimum unpaid share of new mining projects and require that Congolese investors hold at least 10 percent of shares in large-scale mines.

Glencore, Ontario Teachers’ Pension Plan launch mining royalty firm – by Niall McGee (Globe and Mail – December 6, 2017)

December 6, 2017

https://www.theglobeandmail.com/

AngloSwiss mining giant Glencore PLC has struck a deal with the Ontario Teachers’ Pension Plan to create a private royalty and streaming business – one of the first of its kind in the base metals sector.

BaseCore Metals starts life with a portfolio of existing Glencore royalties in North and South America worth $300-million (U.S)., and includes a royalty on Highland Valley, a Teck Resources Ltd. copper mine in British Columbia.

According to a joint press release on Tuesday, Teachers paid cash to Glencore for its 50-per-cent share in the entity. The pension fund declined to comment further when asked by The Globe and Mail about the exact amount of its investment.

Electric charge: Glencore bets big on car battery metals – by Barbara Lewis and Maiya Keidan (Reuters Canada – December 5, 2017)

December 5, 2017

https://ca.reuters.com/

LONDON (Reuters) – Glencore (GLEN.L) has increased production of the metals used to make electric car batteries faster than its major mining rivals, according to an industry-wide analysis that shows the scale of a strategy that has big prospective risks and rewards.

The Anglo-Swiss company’s output of cobalt and copper roughly doubled in the five years to 2016, while its production of nickel quadrupled, the research compiled for Reuters by S&P Global Market Intelligence shows. (Graphic: Glencore’s mining production – tmsnrt.rs/2zOQTgo)

Electric vehicle metals account for roughly 50 percent of Glencore’s core profit, more than double the proportion of its major listed competitors – BHP (BLT.L) (BHP.AX), Rio Tinto (RIO.L) (RIO.AX) and Anglo American (AAL.L).