Glencore has lowered its cobalt production target for this year due to weak market conditions, causing miners to stockpile the metal that is difficult to sell.
The company said on Thursday it plans to produce 35,000 to 40,000 tonnes of battery metals this year, a 42% decrease from its production target set for December 2022. The company also expects production costs at its copper mines to rise due to stockpiles of unsold cobalt.
Glencore was overtaken by China's CMOC Group as the world's top cobalt producer last year, but a sharp cut in its production targets means a major revision to expansion plans that could have put the company back on the throne. . Cobalt production fell by 6% to 41,300 tonnes in 2023, copper production fell by 5% and zinc by 2%.
advertisement
Continue reading below
The cobalt market is being crowded by increased supplies from the Democratic Republic of Congo's CMOC group and a surge in production in Indonesia. Demand for cobalt has also been squeezed by a slowing electric vehicle market and weak sales of consumer electronics.
Glencore has announced that it will reduce cobalt production at its Mutanda mine in Congo by lowering operating rates. It will also affect copper production, it said.
The commodities giant also said it expects adjusted pre-tax profit from its trading business to be $3.5 billion last year, down from its previous forecast of $3.5 billion to $4 billion.
© 2024 Bloomberg
