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Glencore cuts 2019 copper production target
MINER and trader Glencore lowered its target for 2019 copper output following severe flooding in Australia as well as safety outages that led to a 7 per cent year-on-year drop in production in the first quarter.
The news drove Glencore's share price down 2.4 per cent by 0845 GMT on Tuesday.
Q1 copper production fell to 320,700 tonnes, missing BMO Capital Markets' estimate by 11 per cent, while cobalt output jumped 56 per cent.
Glencore said it expects copper production for the year to be 1,460,000 tonnes, plus or minus 30,000 tonnes. It had earlier forecast approximately 1,540,000 tonnes.
This month, BHP Group, the world's biggest miner, and Rio Tinto, the second biggest listed miner, cut their forecasts for iron ore output after a tropical cyclone in Australia.
Glencore also cited safety-related stoppages and smelter outages at Mopani copper mine in Zambia for its Q1 production shortfall.
In addition it narrowed its cobalt outlook, saying full-year output should be 57,000 tonnes plus or minus 4,000 tonnes, versus plus or minus 5,000 tonnes previously.
The mining sector as a whole has come under pressure from concerns about its exposure to environmental and political risk.
Glencore is particularly vulnerable because of its presence in countries, viewed as high risk, such as the Democratic Republic of Congo, although that is also where most of the world's cobalt, needed for electric vehicles, is found.
Glencore's shares fell around 3 per cent on Friday after the US Commodity Futures Trading Commission said it was investigating possible corrupt practices.
Last month Glencore's Katanga Mining unit in Congo restarted after work to treat cobalt which had excess uranium content, something that has constrained exports.
Shipping also resumed last month but is still subject to monitoring.
Glencore, the world's biggest shipper of seaborne coal, has said it will limit its coal capacity as pressure mounts on miners to help curb carbon emissions.
Its coal output in Q1 was up 8 per cent from a year earlier, reflecting the integration of assets Glencore acquired.
BMO in a note said it was a weak Q1, but maintained its "outperform" rating. REUTERS