Anglo American share price rises as it ramps up production

 
Jessica Morris
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(FILE) A couple of gigantic Komatsu 930,
Copper production rose four per cent (Source: Getty)

Shares in Anglo American rose as much as 10.4 per cent to 280.15p today, as the South African miner ramped up production in the face of plunging commodity prices.

The FTSE 100 miners reported copper production rose four per cent year-on-year to 181,400 metrics tonnes in the three months ended December 31. Nickel output added 57 per cent to 10,500 tonnes. However, the production of platinum, iron ore and diamonds all fell during this period.

Big mining firms, including Anglo, are using their economies of scale to weather tumbling metal and mineral prices. They have been increasing production to defend their market share, and even increase it, vis-a-vis some of the smaller mining companies.

The industry has been hurt by an economic slowdown in China, its biggest consumer, as well as a supply glut. This has heaped pressure on mining firms' credit ratings, forcing them to overhaul their business models and scrap dividends.

In December, Anglo announced what it described as a "radical" restructuring plan. The firm will lay off around 60 per cent of its work force, cut capital expenditure by an additional $1bn (£665m) this year and suspend its dividend.

Anglo is due to release its preliminary results on February 16.

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