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Glencore copper output up 8%, trading in line with plans
[LONDON] Glencore's copper production rose 8 per cent in the first nine months of the year thanks to strong output from Africa while the company's trading division performed in line with its expectations.
The miner and commodity trader has the biggest exposure to copper among the diversified miners.
The London-listed company, which makes almost half its profit from the red metal, said copper output from its sources rose to 1,148,600 tonnes in the first nine months of the year, driven by expansion at its Mutanda and Katanga mines in the Democratic Republic of Congo.
Five analysts surveyed by Reuters had given nine-month output forecasts ranging from 1.13 to 1.16 million tonnes.
Glencore shares are roughly flat on the year, but have performed better than most of their peers thanks to a greater exposure to base metals than to iron ore, which has taken a 40 per cent hit this year.
Production of zinc, another key metal for Glencore, fell 6 per cent, mainly due to the closures of depleted mines in Perseverance and Brunswick in Canada last year. "The production numbers look quite good on a nine-months basis," said Investec analyst Marc Elliott, who has a 'buy'recommendation on the stock. "There is some weakness outside of copper but they had already flagged the mines closure and they had flagged that the ramp up in zinc and copper were a bit behind schedule. It doesn't really change my long-term view on the company." Nickel production fell 1 per cent, as increases at the Koniambo project in New Caledonia and stronger output from the Sudbury operations in Canada were offset by the Falcondo, Cosmos and Sinclair mines being placed into maintenance last year. "Marketing continues to perform in line with our plans," the company said about its lucrative trading division.