Johannesburg – Glencore announced on Friday that it would reduce production of zinc by a third because current low prices “do not correctly value the scarce nature of our resources”. The commodity giant, which is struggling with low prices and high debt, said it would cut zinc production by 500 000 tonnes a a year across its operations in Australia, South America and Kazakhstan “to preserve the value of Glencore’s reserves in the ground at a time of low zinc and lead prices”.
Glencore said it would suspend operations at Lady Loretta in Australia and Iscaycruz in Peru, and reduce production levels at George Fisher and McArthur River in Australia as well as at various mine operations in Kazakhstan. No detail was given about the number of staff who would be affected, but estimates are that the cuts would result in at least 1,500 job losses.
Glencore added that it remained positive about the medium and long term outlook for zinc, lead and silver prices.