GROWTH in its South African ferrochrome and coal operations were a highlight amid a mixed production performance for the March quarter reported by diversified global miner Glencore on Tuesday.
Although prices for almost all commodities have continued to weaken, reflecting oversupply, expansion projects launched during the years of higher prices are only now coming on stream.
Attributable ferrochrome production had risen 15% to 385,000 tonnes compared with the same quarter last year, as the Lion 2 expansion project started last April, Glencore said. Total coal production from SA, Australia and South America grew 4% to 35.6-million tonnes, driven by the commissioning of two new projects in SA.
Glencore, which produces and markets more than 90 commodities, including agricultural produce, reported higher quarterly output of ferrochrome, nickel and zinc compared with a year ago but lower output of copper, cobalt, lead and platinum group metals (PGMs).
The lower PGMs’ production reflected poor ground conditions at the Eland Platinum mine near Brits.
Within its energy division, the group’s South African export thermal coal production rose 14% and domestic thermal coal by 6% as the Tweefontein and Wonderfontein mines ramped up.
The group’s share of oil production in Equatorial Guinea and Chad grew 52% to 2.6-million barrels, both from the ramp up of two new fields and an increase shown in its interests in Chad.
Average cash copper prices have fallen 17% between the first quarter of last year and this year, while coal prices have fallen by about 20% on average over the past year.
BHP Billiton CEO Andrew Mackenzie said last month the group was delivering strong operating results while efforts to improve productivity and lower costs were helping to offset weak prices.
Rio Tinto CEO Sam Walsh said the group’s solid production in the March quarter was driven by a focus on efficiencies.