Glencore profit jumps on higher coal and copper prices

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Glencore profit jumps

Glencore’s Australian plans

Glencore also plans to obtain a secondary listing in Australia. Chief Executive Officer Gary Nagle said investors had strongly supported a move into the Australian market.

“It is a deep pool of capital with a strong understanding of the industry,” he said.

The listing decision came around six months after Glencore and Rio Tinto Group ended talks over a potential merger. The deal could have created the world’s largest mining company, but the two sides failed to agree on the premium Rio Tinto would have to offer Glencore shareholders.

Glencore is looking for new ways to improve the liquidity of its shares and support their price. Last year, the company considered a possible U.S. listing but later abandoned the plan.

Competitors’ results

Rivals Rio Tinto and Anglo American also reported strong results as metal prices rose. However, Glencore received an additional boost from its large trading division and the significant role of coal in its business structure.

The war with Iran seriously disrupted global energy markets after the Strait of Hormuz was effectively closed at the end of February. Large volumes of crude oil and petroleum products were trapped inside the Persian Gulf. Attacks on smelters in the region also caused instability in the aluminum market.

Buyers were forced to seek alternative oil supplies, particularly from the U.S. This created additional opportunities for commodity traders. The shortage of petroleum products was also intensified by a series of Ukrainian attacks on Russian fuel facilities, which helped push refining margins to record levels.

Glencore’s trading profit reached $3.3 billion in the first half of the year. Earnings from its coal division rose 35% to $2.4 billion.

The strong financial results came as Glencore continued efforts to sell parts of its extensive asset portfolio. The company is currently negotiating the sale of a stake in its African copper business to U.S.-backed investment firm Orion Resource Partners. Glencore has also discussed a possible sale of its stake in Kazakhstan-based Kazzinc Ltd.

What Glencore does

Glencore is one of the world’s largest diversified commodity companies. It mines and processes copper, cobalt, zinc, nickel, coal, and other resources, while also selling aluminum, iron ore, and energy commodities. In total, the company works with more than 60 types of commodities.

Glencore’s second major business is international commodity trading. The company purchases products from its own operations and third-party producers, then arranges their storage, transportation, processing, and delivery to industrial customers. To support this business, Glencore uses a network of warehouses, vessels, port terminals, and processing facilities.

As a reminder, Glencore laid off some employees a year ago.

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