Africa output growth boosts Glencore copper output
LONDON (Reuters) – Miner Glencore Xstrata met market forecasts with a 24 percent increase in copper production in the first quarter of 2014 mainly due to output expansion at its African operations and to higher grades at its South American mines.
Glencore said the performance of its marketing division was overall "strong and in line with expectations" without elaborating further.
Among diversified miners, Glencore Xstrata has the biggest exposure to copper, which accounted for almost half of its earnings last year.
The mining company produced 382,000 tonnes in the three months, up 24 percent from 321,800 tonnes in the same period a year ago.
African copper production came to 106,400 tonnes, boosted by growth at the Mutanda, Mopani and Katanga operations.
"Glencore's African copper assets remain its strongest source of high quality revenue growth, in our view," Bernstein Research analysts said in a note.
"Today's results reinforce our thesis for Glencore Xstrata, predicated on its high copper exposure and the increasing benefit of its high-grade African copper assets. We reiterate our outperform rating."
Nickel production fell 15 percent after maintenance at some mines last year.
Glencore is now reviewing the annual production expectations from Koniambo in light of the quarterly operational performance and the start-up experiences to date.
Glencore Xstrata shares were down 0.2 percent by 0709 GMT versus a 0.4 fall in the UK-listed mining sector.