Glencore Sees Copper, Cobalt Demand Rebounding; Is Less Certain on Zinc -- Commodity Comment
August 06 2020 - 7:27AM
Dow Jones News
By Will Horner
Glencore PLC scrapped its dividend Thursday as its results
showed a loss for the first half of the year after the coronavirus
pandemic hit demand and prices for the commodities it mines.
However, the miner said demand for copper and cobalt showed
positive signs of recovery.
Here is what Glencore had to say about the outlook for copper,
cobalt and zinc.
Copper:
Glencore said it mined 588,100 metric tons of copper in the
first half of the year, 11% less than during the same period of
2019.
Global mine supply would likely continue to be hurt by the
coronavirus, with new projects likely to experience delays while
aging equipment and declining ore grades were also likely to crimp
global supply, the miner said.
A rebound in demand, led by Chinese factories, would likely
continue, "supported by significant economic stimulus measures
being undertaken globally," the miner said.
Cobalt:
The two key areas of cobalt demand, lithium-ion batteries for
mobile phones and electric vehicles, looked promising, Glencore
said in its report.
There were indications that the harm done by the pandemic to the
mobile-phone sector would be less than feared, the miner said.
Measures undertaken by the Chinese government to subsidize electric
vehicle sales should support demand in the second half of the year,
it said.
"The growing momentum evident across the [electric-vehicle]
sector, together with a recovery in mobile-phone demand, points to
higher future cobalt demand," Glencore said.
Glencore's own mines produced 14,300 metric tons of cobalt in
the first half of the year, 33% less than during the same period in
2019.
Zinc:
On zinc, Glencore said it was still too early to tell what the
metal's supply balance would look like this year, with the scale of
the pandemic's effect on supply and demand still unknown.
"The largest uncertainty remains the final magnitude of the
reduction in zinc demand and 2020's resulting metal balance,"
Glencore said.
Glencore's own operations mined 550,100 tons of Zinc in the
first half of 2020, a 3% rise on the first half of 2019, the report
said.
Write to Will Horner at william.horner@wsj.com
(END) Dow Jones Newswires
August 06, 2020 07:12 ET (11:12 GMT)
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