Diversified global resources group Glencore is confident of delivering its full-year production guidance, with the ranges now tightened to reflect performance to date, it said on Wednesday.
Releasing its half-year production report, Glencore said copper equivalent production rose 5% year on year in the first half, primarily due to the contribution of Elk Value Resources' (EVR) steelmaking coal volumes.
Own-sourced copper production of 343,900 tonnes was 26% below the first half of 2024, primarily due to lower head grades and recoveries associated with planned mining sequencing and the resultant ore fed to the plants.
Cobalt production of 18,900 tonnes was 19% higher, reflecting higher cobalt grades and volumes at Mutanda in Democratic Republic of Congo (DRC).
A ban on DRC cobalt exports is currently in place. Cobalt produced at KCC and Mutanda is being stored in country, and will be sold in due course, Glencore said.
Zinc production was 12% higher than a year ago, reflecting higher zinc grades at Antamina (Peru) and higher McArthur River (Australia) production.
Nickel production was 7% lower, due to Murrin Murrin (Australia) maintenance downtime.
Attributable ferrochrome production of 433,000 tonnes was 28% lower, reflecting pressure on smelting conversion margins, which led to the strategic decision to suspend operations at the Boshoek and Wonderkop smelters, until such time as market conditions sufficiently improve.
Steelmaking coal production of 15.7-million tonnes mainly comprises the Elk Valley Resources (EVR) business acquired in July 2024, which produced 12.7-million tonnes in the first half.
Australian steelmaking coal production was 12% lower due to the temporary suspension of Oaky Creek after a water inrush.
Energy coal production of 48.3-million tonnes was broadly in line with the comparable period, reflecting stronger Australian production offsetting the more recent voluntary production cuts at Cerrejón (Colombia).
Glencore CEO Gary Nagle said the group had made progress in optimising the business.
“A comprehensive review of our industrial asset portfolio during the period recognised opportunities to streamline our industrial operating structure, to optimise departmental management and reporting, and to support enhanced technical excellence and operational focus,” he said.
He said the review identified about $1bn of cost savings opportunities across various operating structures, which are expected to be fully delivered by the end of 2026.
Nagle said the second half expected to generate significant cost savings resulting from those initiatives.
“Given completion of the sale of Viterra in early July, and, despite no longer including our share of Viterra earnings in our marketing adjusted earnings before interest and tax (ebit) going forward, we now take the opportunity to revise up our through-the-cycle long- term marketing adjusted ebit guidance range to $2.3bn to $3.5bn per annum (from $2.2bn to $3.2bn previously), representing a midpoint increase of 16% from $2.5bn (ex-Viterra) to $2.9bn,” he said.
Glencore will release first half financial results on August 6.
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