Glencore Plc reported the weakest profit in three years and announced plans to halt about a fifth of the world’s cobalt production after prices for the battery metal plunged.
Glencore will shutter Mutanda project in the Democratic Republic of Congo for about two years in a move to put a floor under cobalt market, which has seen prices fall more than 70% since April last year. Despite the plunge in profits, Glencore’s CEO struck an upbeat tone on outlook for rest of year, saying he doesn’t see a big pullback in commodities demand because of the US-China trade war.
“Demand is not that bad,” Glasenberg said on a call. Still, he acknowledged that “sentiment is not that great” from the trade war and customers are running down inventories.
Falling profits are the latest blow to Glencore, which has been hobbled by corruption probes, tumbling prices and operational problems at key copper mines. Investors punished the company, sending the stock down as much as 4.7 percent on Wednesday, a seventh day of losses.
The shares have tumbled 22% this year to the lowest since 2016.