Glencore reports lower 2023 copper, nickel, cobalt output; flags further falls

Copper, nickel and cobalt are materials used for electric vehicles, a key plank of the energy transition.

“Production challenges have become common in the industry, and a lack of supply growth in most commodities in mining should lead to a squeeze higher in prices over the next 12+ months,” Jefferies analysts said.

“Higher prices over time should offset the negative impact of declining volumes for Glencore,” they added.

The London-listed company reiterated its expectation that 2023 profits from its trading division would be $3.5 billion, above its long-term guidance range between $2.2 billion and $3.2 billion.

Glencore said it produced 1.01 million metric tons of copper in 2023, down 5% from 2022 and compared to its previous guidance of 1.04 million tons.

It now expects copper production of between 950,000 and 1.01 million tons this year, reflecting the sale of its Cobar mine in Australia.

Analysts have forecast a copper deficit from this year on signs that supply may not be as robust as previously thought after Panama ordered the closure of First Quantum’s 350,000 ton-a-year mine and major producers Anglo American, Codelco and Vale Base Metals lowered their guidance.

Glencore produced 97,600 tons of nickel in 2023, lower than its revised October guidance, partly due to a maintenance shutdown of its Murrin Murrin mine in Australia. It expects 2024 production of about 80,000 to 90,000 tons.

Other producers including the world’s largest listed miner BHP have put nickel projects on ice to counter falling prices for the metal.

Glencore’s cobalt production stood at 41,300 tons in 2023. The company expects this to be between 35,000 and 40,000 tons this year.