Glencore has announced a decrease in its production of copper, nickel, and cobalt for 2023, with expectations set for continued declines into the current year. These materials, crucial for electric vehicle manufacturing, have seen a downtrend in output amid broader industry challenges.
Analysts from Jefferies point out that production hurdles are becoming increasingly common across the mining sector, suggesting that these constraints could lead to higher prices for commodities due to limited supply growth. They anticipate that any potential price increases could help mitigate the impact of reduced production volumes for Glencore.
The company has also confirmed that its trading division’s profits for 2023 are projected to surpass its long-term guidance, targeting $3.5 billion against an expected range of $2.2 billion to $3.2 billion.
In detail, Glencore’s copper production fell by 5% in 2023 to 1.01 million metric tons, slightly below its forecasted 1.04 million tons. Looking ahead, the company projects its copper output to range from 950,000 to 1.01 million tons, influenced by the sale of the Cobar mine in Australia.
The forecasted copper deficit, underscored by reduced supply expectations from major mining entities and the recent closure of a significant mine in Panama, adds to the concerns over supply robustness.
For nickel, Glencore reported a production of 97,600 tons in 2023, which was below its revised guidance from October, partly due to a maintenance shutdown at its Murrin Murrin mine in Australia. The company anticipates nickel production to be between 80,000 and 90,000 tons in 2024, as the industry faces price pressures that have led other producers, including BHP, to pause nickel projects.
Cobalt production for Glencore stood at 41,300 tons in 2023. The company expects cobalt output to decrease further to between 35,000 and 40,000 tons this year, reflecting broader trends of production declines across its key commodities. 
