Yesterday, 3:45 PM
- Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) fell to its lowest level since its 1999 London listing, as the miner continues to buckle under slumping natural resource prices.
- HSBC on Wednesday downgraded its rating on the stock to Reduce and cut its price estimate to 410 pence, saying Anglo will continue to burn through cash even after cutting costs and potentially scrapping its payout to shareholders.
- HSBC anticipates "more near-term pain" and no "clarity on a long-term resolution to reverse potential cash burn," and adds to speculation that the company may follow rival Glencore (OTCPK:GLCNF, OTCPK:GLNCY) in cutting its dividend.
- HSBC also says that while Anglo’s niobium and phosphate business in Brazil and parts of its South African coal operations were viable candidates for sale, the company may struggle to raise significant funds in the current market.
- Separately, Anglo is denied permission by New South Wales planning authorities to expand its Drayton coal mine, ruling that an expansion would pose a risk to nearby horse stud farms; Anglo says it likely will close the mine, which would put 500 miners out of work.
Fri, Nov. 20, 8:36 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) has secured a deal to buy as much as half of the oil Libya is currently exporting, as it looks to boost trading to help offset flagging profits from mining, Reuters reports.
- In the deal with Libya's state-run oil company, which began in September, Glencore loads and finds buyers for crude oil exported from the Marsa el-Hariga port, which has become Libya's largest exporting terminal as the two biggest - Es Sider and Ras Lanuf - remain closed.
- Battles between rival factions seeking to control the country, as well as local strikes and blockades, have brought nationwide production below 500K bbl/day for most of the past year from a peak of 1.6M bbl/day.
Wed, Nov. 18, 12:37 PM
- Before today's gain, Glencore (OTCPK:GLCNF, OTCPK:GLNCY) shares had dropped 29% over nine straight days in London for its longest losing streak on record, as prices for the copper and zinc the company produces reached six-year lows.
- CEO Ivan Glasenberg’s $10B debt reduction plan, including asset sales and output cuts, breathed life into share prices that collapsed early last month, but now the stock is falling again and analysts say further declines in copper prices could yet undermine the company's rebound.
- Copper is down 10% since Glencore announced its $10B debt reduction plan on Sept. 7 and hit a six-year low yesterday, while zinc has fallen 14% and thermal coal, of which Glencore is the no. 1 exporter, has dropped 7.6% percent; not only do weaker commodity prices hurt its income, but also the value of mines and stockpiles it uses to calculate net borrowings.
- At current prices, Glencore would generate $7.3B in EBITDA next year, and another 10% drop in commodities would cit ~$1B off that figure, says Jefferies mining analyst Chris LaFemina.
Mon, Nov. 16, 2:55 PM
- BHP Billiton (BHP +0.4%) says it is reviewing two other mining joint ventures in Peru and Colombia following the dam disaster at the Samarco iron ore mine in Brazil, which it jointly owns with Vale (VALE -1.7%).
- Cerrejón in Colombia is one of the world's largest open pit coal mines, and is owned equally by BHP, Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) and Glencore (OTCPK:GLCNF, OTCPK:GLNCY); BHP and Glencore each have 33.75% stakes in Antamina, Peru's biggest copper and zinc mine, while Teck Resources (TCK +0.8%) holds 22.5% and Mitsubishi 10%.
- Vale says it will take several years for the Rio Doce river to recover after it was flooded with mud from a burst tailings dam run by Samarco, a joint venture between Vale and BHP Billiton
- Costs and fines already incurred as a result of the dam burst have exceeded insurance against civil damages, a Vale executive says.
Thu, Nov. 12, 8:59 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) tumbles below £1 for the first time in a month as a renewed selloff in the stock accelerates and copper prices trade near six-year lows.
- Glencore is "very geared into the copper price,” says an analyst at Liberum Capital. “Prices are obviously taking a hit on the back of U.S. dollar strength and the Fed’s clear intention to raise rates before the end of the year."
- Rival mining company Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) is 9% lower in London trading to its lowest level since 1999.
Wed, Nov. 11, 11:19 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) and Vedanta Resources' (OTCPK:VDNRF) plans to cut costs at unprofitable copper mines in Zambia are facing strong resistance from the government and trade unions, Reuters reports.
- The president of one of the country's top unions says the Mopani copper mines owned by Glencore should be forced to surrender its mines to the government if the company pursues a plan to lay off workers; Glencore's Zambia unit has said to plans to lay off more than 3,800 workers because of lower metal prices and rising production costs.
- Konkola Copper Mines, owned by Vedanta, says its Nchanga mine was making "unsustainable losses," responding to reports the company is set to close the operation and lay off 2,500 contractors.
Tue, Nov. 10, 2:57 PM
- Rio Tinto (RIO +1.4%) is upgraded to Overweight while BHP Billiton (BHP -0.4%) is downgraded to Equal Weight at Barclays, which says Rio has a relatively attractive balance sheet in a struggling industry.
- But Barclays downgrades its overall mining sector view to Neutral, adding that it would have reverted to our Negative call of 2013-14 if not for the recent pickup in some Chinese data; looking forward, the firm fins it "hard to see what might pull the sector out of its tailspin."
- The firm sticks with its Overweight rating for Glencore (OTCPK:GLCNF, OTCPK:GLNCY), and rates Anglo American (OTCPK:AAUKF, AAUKY]]) and Vale (NYSE:VALE) at Underweight.
Mon, Nov. 9, 6:17 PM
- Copper prices plunged to a six-year low today, dragging down mining company shares, after China's import data showed declining demand from the world's top buyer of the industrial metal.
- China's imports of copper and copper products for the first 10 months of 2015 fell 4.2% Y/Y to 3.82M tons, the government said today; China accounts for ~40% of global copper demand, and the import data highlights long-running concerns that the country's economic slowdown would translate into lower copper imports.
- The fall in copper prices rattled the mining sector, which has been battered by a prolonged slump in metals prices; Glencore (OTCPK:GLCNF, OTCPK:GLNCY), which got 20% of its operating income from copper production in H1 of 2015, fell 5.3% in London, and Freeport McMoRan (NYSE:FCX) ended 2.3% lower.
- ETFs: JJC, CPER, CUPM
Thu, Nov. 5, 11:48 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is upgraded to Buy from Hold with a 12-month price target of £2 ($3.08) from £1.90, implying a 60% rally from yesterday's London closing price of £1.259, at Deutsche Bank.
- Glencore has demonstrated that its liquidity position is safe and that its debt reduction plan is likely to exceed expectations, the firm says, adding that there are “still issues to fix, but [the] current price is too cheap."
- The upbeat assessment comes after Glencore yesterday said it has made significant progress in cutting its net debt by undertaking a series of measures to improve its finances.
Wed, Nov. 4, 3:53 AM
- Glencore (OTCPK:GLNCY) said it expects net debt to fall to $25B by the end of the year from $29.6B at June-end, in one of the first official updates from the company since its share price plummeted in September on concerns about its high debt levels.
- The firm also revealed it was working on a second so-called streaming deal – selling the long-term rights to buy precious metal in return for an upfront payment - and reiterated guidance for its trading arm, the company's main cash generator.
- Glencore shares rose 6% on the news in London, but have fallen almost 60% YTD.
Tue, Nov. 3, 5:35 PM
- Silver Wheaton (NYSE:SLW) agrees to acquire future silver output from Glencore's (OTCPK:GLCNF, OTCPK:GLNCY) stake in the Antamina copper mine in Peru for $900M cash.
- As part of the streaming deal, SLW also will make ongoing payments of 20% of the spot price for silver for every ounce of metal delivered.
- SLW says the deal immediately increases its production and cash flow profile by adding expected average silver production of 5.1M oz./year in 2016 and 2017, and 4.7M oz./year over the first 20 years.
Thu, Oct. 29, 10:57 AM
- Industry sources tell Reuters that Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is reducing its $18B inventory pile, a move ratings agencies say could help ease concerns about its balance sheet.
- "If you look at where commodities prices are today and how the market conditions changed in the past six months - it is fair to say that the only way for inventories is to go down," a source close to Glencore reportedly told Reuters.
- Such a could help appease ratings agencies such as Moody's and S&P, which both rate Glencore just two notches above junk with a negative outlook.
- "Sometimes the balance sheet is just more important than the contango play," according to the Reuters source.
Fri, Oct. 23, 8:54 AM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) says it will resume operations today at its Nickel Rim South mine in Sudbury, Ontario, two days after a worker was killed at the site.
- Glencore, which also operates the Fraser mine, Strathcona mill and Sudbury smelter in Sudbury, says the Ontario Ministry of Labor investigation is ongoing.
Wed, Oct. 21, 9:09 AM
- Zijin Mining (OTCPK:ZIJMF) and OZ Minerals (OTCPK:OZMLF) are among companies weighing interest in the Cobar copper mine in Australia that Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is selling to cut debt, Bloomberg reports.
- Analysts say Glencore’s sales of the asset in New South Wales state, along with a larger project in Chile, could fetch as much as $1B combined.
- The Cobar mine produces ~50K metric tons/year of copper concentrate.
Thu, Oct. 15, 2:47 PM
- Glencore (OTCPK:GLCNF, OTCPK:GLNCY) is preparing a plan it hopes will result in an upgraded credit rating, in a previously undisclosed part of the miner’s attempt to strengthen its balance sheet, WSJ reports.
- Glencore has said it would reduce net debt by $10B, lowering the debt to ~$20B, but plans to raise cash through streaming deals, asset sales and other moves could potentially cut more than $12B, putting its net debt at ~$18B; with those reductions, Glencore is said to be targeting a credit rating that would put its debt 3-4 notches above junk.
- Glencore’s debt currently is ranked two notches above junk with a negative outlook by Moody's and S&P.
Thu, Oct. 15, 11:43 AM
- Anglo American (OTCPK:AAUKF, OTCPK:AAUKY) and Glencore (OTCPK:GLCNF, OTCPK:GLNCY) are postponing expansion plans for their jointly owned Collahuasi copper mine in Chile, as prices for the metal face six-year lows.
- The companies already had planned to cut output at Collahuasi by 30K metric tons as well as dozens of jobs because of difficult market conditions, but now the growth project also is delayed.
- Expansion plans to double Collahuasi's annual production to ~1M metric tons had been under consideration for some time, which was originally expected to cost $6.5B.
Glencore Xstrata is one of the worlds largest global diversified natural resource companies and is one of the ten biggest companies within the FTSE 100 Index. The Groups industrial and marketing activities are supported by a global network of more than 90 offices located in over 50 countries.
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