GLENCORE’S transformation into a publicly listed company has forced the commodities giant to lift the lid on some of its most closely guarded business secrets, revealing the true extent of its dominance in the global supply of raw materials.
The newly published financial information shows that the firm has a 60 per cent market share in marketable zinc metal (zinc that is suitable for trading on markets), and a 50 per cent market share in zinc concentrates and copper metal.
Its market share in global production terms is 13 per cent share in zinc, 14 per cent in nickel and 23 per cent in cobalt. Overall, the company trades in and produces 16 different kinds of commodities, from grains to thermal coal. From one mine alone, it forecasts production of 1.16m metric tonnes of copper over the next five years.
Its strong presence in the marketable thermal coal market (28 per cent) is one reason for the trader to seek a dual-listing in Hong Kong and London, a plan first revealed by City A.M. in December (see below), rather than staying in London alone.
The $2.2bn listing in Hong Kong will give it ready access to insatiable Chinese demand for coal.
But the trader also boasts ownership of mines the world over from Chile to Kazakhstan as well as stakes in FTSE?100 miner Xstrata and aluminium producer RUSAL.
In its “intention to float” document, the firm makes a strong pitch to investors based on its “strong reputation over decades as a reliable supplier of quality products on a timely basis”.
It adds that its dual role as a miner and marketer “makes Glencore’s earnings less volatile than those of equivalent pure commodity producers”.