Glencore’s Strategic Shifts and Commodity Clout Position It for a Share Price Surge

The commodities landscape in 2025 is a tale of volatility and opportunity. For Glencore (LON:GLEN), a Swiss-based multinational mining giant, navigating this terrain requires both agility and long-term vision. Recent operational adjustments, strategic acquisitions, and a bullish analyst consensus suggest the company is primed to capitalize on its strengths—and investors should take note.

Navigating Copper’s Headwinds with Operational Precision

Glencore’s Q1 2025 results revealed a 30% year-on-year drop in copper production to 167.9 thousand tonnes (kt), driven by lower ore grades and recoveries at key mines like Collahuasi (Chile) and Antapaccay (Peru). While this underperformance spooked markets in the short term, management has laid out a clear path to recovery.

By mid-2025, Glencore expects production to rebound, with 58% of annual copper output weighted to the second half. This confidence stems from operational fixes:
- Collahuasi: A new pit reorientation and desalination plant will boost water availability and truck efficiency.
- Antapaccay: High strip ratios (5:1 in early 2025) are projected to decline to 3:1 by Q4, reducing costs and accelerating production.
- KCC (DRC): Transitioning from stockpiled to run-of-mine ore will increase throughput by ~25% in H2 2025.

With copper prices hovering around $9,000/tonne—a 15% increase from 2024 lows—successful execution here could unlock significant revenue growth.

Steelmaking Coal: A Game-Changer for Revenue Stability

Glencore’s July 2024 acquisition of Elk Valley Resources (EVR) has transformed its coal division. In Q1 2025, steelmaking coal production surged 493% to 8.3 million tonnes (Mt), thanks to EVR’s contribution of 6.6 Mt. This diversification is critical: while copper faces short-term headwinds, coal is proving to be a reliable cash generator.

The EVR deal also positions Glencore to benefit from reshoring trends in global manufacturing. As countries prioritize domestic supply chains, demand for high-quality metallurgical coal—used in steel production—could remain robust. Analysts at BMO Capital noted this shift, reiterating an “Outperform” rating and raising their price target to 475p in December 2024.

Cobalt’s Rise and Geopolitical Leverage

Cobalt, a critical mineral for EV batteries, saw Glencore’s production jump 44% to 9.5 kt in Q1 2025. However, the Democratic Republic of Congo’s (DRC) cobalt export ban—now causing prices to surge by 50%—has created a logistical challenge. Glencore’s response? Store excess production domestically while lobbying for policy changes. This strategic patience is paying off: cobalt’s scarcity and geopolitical importance are making it a “critical” asset in U.S. supply chain strategies.

Analysts See a Strong Upside—But Risks Linger

The analyst community is overwhelmingly bullish. As of May 2025, the average 12-month price target stands at 522.22p, a 53% upside from the April 2025 closing price of 340p. The highest target, 630p, reflects optimism about Glencore’s ability to leverage its diversified portfolio in a fragmented market.

Yet risks remain. China’s tepid economic growth continues to dampen commodity demand, while U.S. tariffs on steelmaking coal and energy coal could disrupt trade flows. Glencore’s marketing division—which accounts for ~40% of its revenue—is also exposed to these headwinds. Management, however, remains confident, citing its ability to “reorient trade routes” and capitalize on price volatility.

Conclusion: A Bull Case Built on Execution

Glencore’s 2025 journey hinges on two critical factors: delivering on its copper production rebound and maintaining its coal dominance. If it succeeds, the average analyst target of 522p could easily be surpassed, especially with cobalt prices climbing.

Key data points reinforce this bullish case:
- Revenue Projections: Analysts forecast a 99.8% revenue increase to £116.97 billion by end-2025, driven by higher commodity prices and volume growth.
- EPS Growth: A projected 1,891% jump in EPS to £0.17 by December 2025 underscores the earnings potential of operational improvements.
- Valuation Support: The median price target of 530.40p aligns with a P/E ratio of ~30x forward earnings—a premium justified by Glencore’s role in critical minerals and coal reshoring.

While near-term share price volatility is inevitable, Glencore’s strategic moves—operational pivots, strategic acquisitions, and risk management—position it to thrive in a commodities landscape increasingly defined by geopolitical fractures and decarbonization demands. For investors willing to look past short-term dips, the path to a multiplied share price is clear.