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Glencore reported a fall in copper output in the first half of the year, led by weaker-than-expected performance in its African copper business and the miner also flagged a $350m hit on its cobalt business following a drop in prices.
First-half copper output fell 5% from a year earlier, while cobalt output rose 28%.
Coal and Zinc production rose 10% and 8% respectively, while nickel production fell 11% in the half.
The company said it expected a mark-to-market loss on around 10,000 tonnes of cobalt, representing a $350m hit to earnings (EBIT).
The company blamed the losses on cobalt purchase commitments from its own mines, primarily in the DRC, that cannot be perfectly hedged due to 'the illiquid and immature hedging tools.'
'I am pleased to report a solid performance from our underlying base business, where our key assets in copper, coal, zinc and nickel performed largely in line with our expectations. However, our African copper business did not meet expected operational performance,' said Glencore Chief Executive Officer, Ivan Glasenberg.
' African copper assets retain significant potential and will play a key role in the transition to a low carbon economy. We have developed detailed turnaround plans and I look forward to taking you through these plans along with our financial performance on 7 August.'
At 9:00am: (LON:GLEN) Glencore PLC share price was -2.52p at 270.48p