Outgoing Glencore chief affirms potential for commodities boom after 2020 earnings call

Glencore has reinstated its dividend despite reporting a full-year net loss of US$1.9 billion after recording big writedowns in a COVID-impacted 2020.

The mining giant and commodities trader will pay a $1.6 billion dividend, which could be increased later in the year if prices remain strong, chief financial officer Steve Kalmin told reporters on a call.

In its full-year financial report, Glencore reported $3.3 billion in earnings before interest and tax at its trading business, almost evenly split between oil and metals. The company also brought its debt back down to within a target range.

After reinstating Glencore’s dividend, which was withdrawn last year due to the potential financial impact of COVID-19, outgoing CEO Ivan Glasenberg affirmed the potential for a commodities boom, amid speculation of another supercycle.

“Is it a supercycle? It all depends,” Glasenberg said. “Supply is getting tight, it’s looking good. China is strong and we need America kicking in with more demand.”

Having lead Glencore for almost two decades, Glasenberg will hand over the reins of the company in the coming months to fellow South African Gary Nagle, who currently runs the coal business.

“Today, the business and its portfolio of commodities is uniquely positioned for the needs of the future,” Glasenberg added. At the end of last year, Glencore become the only major mining outfit to outline 2050 carbon neutrality plans including scope 3 emissions.