Table of Contents
Key Points
- Glencore aims to cut $1 billion in global operating costs by end of 2026 amid refining and coal profit pressures.
- The trading division expects $2.3 billion to $3.5 billion in profits this year, beating earlier forecasts with $1.35 billion in H1.
- Plans include spinning off coal business on the NYSE and closing Mount Isa copper mine, shifting focus to energy transition metals.
Glencore Plc, the Swiss commodity trading and mining giant led by South African executive Gary Nagle, is targeting $1 billion in cost reductions across its global operations by the end of 2026. The move follows a strategic review of its vast industrial footprint, including mines and smelters, as the company responds to falling commodity prices and margin pressure in refining.
The cost-cutting announcement comes as Glencore raises its long-term profit forecast for its trading division for the first time in seven years, a signal of renewed confidence following its recent sale of grain business Viterra to Bunge Global SA.
Refining struggles, coal weakness fuel overhaul
“We’ve identified clear opportunities to streamline operations and sharpen our industrial focus,” Glencore CEO Gary Nagle said in a statement Tuesday. The restructuring effort, aimed at improving how departments are managed and how technical systems are run, comes at a difficult time for the company.
Processing fees in its refining arm have fallen to historic lows, and coal, once Glencore’s biggest money-maker, is no longer delivering the returns it used to. The company has not yet broken down where it plans to cut costs, only saying that more details will be shared in its upcoming earnings report.
Glencore trading profits beat expectations
Even so, Glencore’s trading arm continues to hold up well. The division, which sets the company apart from more mining-focused rivals like Rio Tinto and Anglo American, now expects to earn between $2.3 billion and $3.5 billion this year—slightly higher than its previous forecast. It pulled in $1.35 billion in the first half alone, showing that the business still knows how to navigate unpredictable markets.
Still, executives say the broader environment is more complicated than it was during the boom in 2022, when the Russia-Ukraine war helped fuel record profits. Geopolitical uncertainty — including questions over whether Donald Trump could return to the White House — has added new layers of risk. Sudden price swings tied to global headlines have made it harder to hedge positions or plan ahead with confidence.
Glencore reshapes portfolio for energy transition gains
Founded in the 1970s as a commodity trading house, Glencore has transformed into a mining and energy powerhouse operating in 35 countries with over 150,000 employees. Under Gary Nagle’s leadership, the company has prioritized growth in metals and energy sectors.
Glencore is also preparing a major restructuring of its coal business, with plans to spin off the division and list a new entity on the New York Stock Exchange. Separately, it will shut its Mount Isa copper mining operations in Australia, with a smelter sale to the Philippines’ Villar family also underway — part of a wider shift toward metals vital for the energy transition.
