GLENCORE said its marketing division would benefit from high interest rates helping it report earnings before interest and tax of between $3bn to $3.5bn for its 2024 financial year ended December 31. It previously guided to a $2.2bn to $3.2bn range.
The Swiss headquartered miner also maintained its full-year production guidance despite lower first quarter production year-on-year for cobalt and ferrochrome.
“First quarter copper, zinc and coal production was broadly in line with the prior year comparable period, while nickel increased 14%, reflecting recovery from the Raglan strike impacts in the base period,” CEO Gary Nagle was quoted as saying by BusinessLive.
“Lower year-on-year cobalt and ferrochrome volumes primarily reflect the previously announced market-related production adjustments in Democratic Republic of Congo and the decision to idle our Rustenburg ferrochrome smelter in the current price environment,” he said.
Own-sourced copper production of 239,700 tons was 2% above the first quarter of 2023 on a like-for-like basis, removing 8,700 tons of Cobar (sold in June 2023) volumes from the prior period, the group said in its quarterly update.
Own-sourced cobalt production of 6,600 tons was 3,900 tons lower than a year ago, mainly reflecting planned lower run- rates at Mutanda in the current weak cobalt pricing environment and mill downtime at KCC, said BusinessLive.
Attributable ferrochrome production of 297,000 tons was 103,000 tons (26%) below the first quarter of 2023, as the Rustenburg smelter remains idled, pending an improved price-cost environment.
Coal production of 26.6 million tons was broadly in line with the first quarter of 2023. South African thermal coal production of four million tons was in line with a year ago.
Glencore expects coal production of 105 to 115 million tons for 2024. It said it expected copper production of 950,000 to 1.01 million tons in 2024.
Earlier this week, Bloomberg News reported that several of Glencore’s largest shareholders believe it should retain its coal assets, throwing a proposed spinoff into doubt.
Morgan Stanley said in a note on Tuesday that retaining the coal assets would not be a surprise move for Glencore.
“In our view, the proposed split of Glencore into a metals and a coal business would introduce significant uncertainty with respect to the potential re-rating of the Metals Co given its geographic exposure (DRC, Kazakhastan…etc) and the sizeable share of zinc, nickel, and other metals in the portfolio that may lower the multiple applied to this business relative to copper pure-plays,” the bank said.
