Last week, Anglo American announced production results from its third quarter while maintaining this year’s guidance for the minerals. In its results, the global miner revealed that the output of rough diamonds has dropped by 25% on cuts because of prolonged reduced demand.
The production of copper also decreased by 13% in the third quarter, adding that for the first 9 months of the year, the red metal’s production dropped by 4%. During the same period, the production of diamonds fell 21%.
The global miner added that its De Beers diamonds unit was looking into alternative options to increase output cuts.
Despite these decreases, Anglo American still expects to produce 23 to 26 million carats of rough diamonds and between 730,000 to 790,000 copper tons in 2024. Currently, the global miner is restructuring its business to primarily focus on copper needed for the transition to clean energy.
This comes after Anglo rejected a multi-billion-dollar takeover offer from BHP Group earlier in the year. The deal, if it had gone through, would’ve allowed BHP to control all of Anglo American’s copper assets in Latin America and the miner’s metallurgical coal assets. It would’ve also increased access to copper, which is central to electric vehicles and the worldwide shift to clean energy.
The restructuring will see Anglo sell its nickel mines in Brazil and its steelmaking coal assets in Australia. This follows its announcement that production of steelmaking coal dropped 6% in the third quarter. This change came after the company shut its Grosvenor mine, located near Moranbah in the Bowen Basin coal mining province of central Queensland, after an underground fire occurred.
The fire began when methane gas ignited, but thankfully, all mine workers were safely evacuated.
In addition to this, Anglo American plans to divest De Beers and its Amplats platinum business in South Africa. Following these moves, the red metal will make up 60% of the global miner’s business, with Anglo also retaining its iron ore mines in Brazil and South Africa.
The miner will also retain its currently slowed down Woodsmith fertilizer project, based in the U.K.
Anglo American, which is the 3rd biggest exporter of metallurgical coal globally, also reduced its annual production guidance. From its previous figure of 15 to 17 million tons, its new guidance stands at 14 to 15.5 million tons. In a statement, the miner revealed that the final bidders round for its coal assets was set up, adding that it would announce the sale agreement in a few months.
Other companies like Torr Metals Inc. (TSX.V: TMET) are making headway in exploring for and advancing copper projects. As these new supplies come online, production drops at companies like Anglo American will be unlikely to affect the overall market.
NOTE TO INVESTORS: The latest news and updates relating to Torr Metals Inc. (TSX.V: TMET) are available in the company’s newsroom at https://ibn.fm/TMET
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