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Glencore: Coal market performance is worse than during financial crisis
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The slowdown across global economies is boosting a coal surplus that’s pushed prices for the fuel to the lowest level in eight years, according to Glencore Plc.
Coal prices have suffered amid a broader commodities turmoil that has hurt Glencore. The firm's shares lost 29% on Sept.28 amid worries over its debt load and plunging commodity prices.
The Swiss company, the world’s biggest exporter of thermal coal, has since rebounded after it said business was strong and it had secure access to funding. The company's shares were last up 9.67%.
Peter Freyberg, Glencore’s head of coal, said that the market continues to rebalance against the backdrop of a weaker-than-estimated demand.
The mining behemoth, which in February announced it would lower Australian output by 15 million metric tons this year and suspend some projects, will continue to review its operations to find ways of saving money, Freyberg said.
Global economic uncertainty has accompanied the collapse in coal prices, Freyberg said. “Growth rates in much of the developing world - most obviously in China - have slowed considerably.”
The world's second largest economy is the biggest consumer of grains, energy and metals. It is expanding at the slowest pace in two decades, triggering volatility in global markets.