Glencore ups expectations for FY trading, lowers nickel, coal

Glencore on Friday raised expectations for its trading division following improved market conditions and a surge in commodity prices, but lowered full-year guidance for nickel and coal, citing output disruptions.

The figures are a foretaste of first-half financial results set for Aug. 5. Peers Anglo American (LON:AAL) and Rio Tinto (LON:RIO) have dished out higher shareholder payouts in 2021 after the commodity rally.

London-listed Glencore (LON:GLEN) said it expects its full-year earnings before interest and taxes (EBIT) for its marketing – or trading – division to be at the top end of its annual range between $2.2 billion and $3.2 billion.

For output, it left its full-year guidance for copper and cobalt output broadly unchanged, but lowered its expectations for zinc, nickel and coal.

Coal production fell 16% to 48.7 million tonnes in the first half, partly because of market-related cuts in Australia that started in the second half of 2020, and reduced exports from South Africa.

Lead output fell by 9% to 117,000 tonnes and nickel was down 14% to 47,700 tonnes over the period. In the first half, zinc production rose by 6% to 581,800 tonnes, as COVID-related suspensions started to be lifted, but Glencore said the second half could be slower than previously thought.

Copper production rose by a modest 2% to 598,000 tonnes and battery material cobalt by 3% to 14,800 tonnes in the first half.

Oil output of 2.56 million barrels of oil equivalent (boe) was down 2% from the same year-ago period, as care and maintenance at its Chad oilfields was offset by output at its Equatorial Guinea project.