Monsters of Rock: Harder, better, faster, stronger – mining giants put copper front and centre

Mining giants have fronted investors ahead of Christmas, with Glencore eyeing major copper growth and Rio trying to prove its fitness.

Work it harder, make it copper. Pic: Getty Images

• Major miners Glencore and Rio Tinto fronted shareholders to deliver their updated strategies in London this week

• Copper was front and centre after price hit record of close to US$11,500/t

• Glencore chasing 1.6Mtpa copper output by 2035, while Rio's new boss Simon Trott is focusing on slimming down the business to boost earnings

The strategy sessions laid out by two of the world's biggest miners this week – long regarded as potential merger partners – has made one thing clear for broader sector investors. The majors are putting copper front and centre.

It was precipitous timing for Glencore and Rio Tinto (ASX:RIO), who faced shareholders and analysts after copper climbed to a record high of almost US$11,500/t this week.

Glencore was first out of the gate, revealing a dream to grow copper output from a downgraded 810-870,000t in 2026 to 1Mt in 2028 and 1.6Mt by 2035, starting with the redevelopment of the Alumbrera copper mine in Argentina.

From H1 2028 it will produce 75,000t of copper, 317,000oz of gold and around 1000t of molybdenum, linking in with the planned multi-billion dollar development of the Minera Agua Rica project in Catamarca.

Speaking to investors in London, Glencore CEO Gary Nagle said the emerging deficit for copper, as much as 27Mt by 2050, was starting to be reflected in pricing.

"Since the middle of 2024 we've seen prices start to grind higher ... we don't like the spikes because we know spikes are because of things in the market which are a little unnatural," he said.

"We want to see that continual grind higher of pricing to give us that comfort that we will reach that US$12, US$13, US$14,000, because you don't turn on a copper mine in five minutes.

"We've now started to see a trend change and step change in copper pricing.

"We do not see demand destruction, we do not see buyers' strikes. That's giving us the comfort to say now is the time to sanction these projects."

Nagle is confident Glencore has enough undeveloped brownfields and greenfields projects in its portfolio to make the 1.6Mtpa target 'conservative'.

The aim is to make Glencore the largest copper producer in the world by 2035 and fourth largest by 2029, well and truly throwing down the gauntlet to its competitors at BHP (ASX:BHP), Rio Tinto (ASX:RIO), Codelco and Freeport.

Whether it gets there is another matter, and there is plenty of competition.

Teck Resources shareholders are set to vote next week on a deal to merge with Anglo American, which would produce one of the world's largest copper companies with key synergies between Anglo's Collahuasi (partly Glencore owned) and Teck's Quebrada Blanca in Chile.

BHP made a second failed attempt to acquire Anglo last week in a bid to scupper the merger.

Glencore, which tried to buy Teck two years ago only to end up with just its steelmaking coal portfolio, would seek to maintain the scale of its stake in Collahuasi, Nagle said.

Rio Tinto's diet plan

New Rio Tinto CEO Simon Trott is, meanwhile, aiming to trim the fat as expected when the practical WA farm boy took over from Danish economist Jakob Stausholm this year.

Titled 'Stronger, sharper and simpler' – reviling marketing jargon we prefer a Daft Punk reference ourselves – his presentation at Rio's capital markets day in London on Thursday set out the lay of the land in the new regime.

Mineral sands and boron businesses are already reported to be on the chopping block as the mining giant chases US$5-10bn in asset sales – including infrastructure like power stations and desalination plants – to reinvest in its core businesses.

It now has just four main arms – the miner's world-leading iron ore business, its copper mines, aluminium assets and the lithium projects in South America it acquired over the past couple of years.

“We are delivering strong early productivity benefits and cost savings with more to come," Trott said in a statement.

"Freeing up cash from our asset base where it makes sense will strengthen the balance sheet and maintain returns, as we invest for the future with discipline.

“Our experienced leadership team is committed to delivering against our mission to become the most valued metals and mining company – for shareholders, the people who work with us, our partners and the communities around us.”

Rio, which also claimed a processing breakthrough on a novel copper refining process called Nuton, has upped its copper guidance for 2025 to 860-875,000t from 780-850,000t, delivering a big beat on costs (from 110-130c/lb to US80-100c/lb).

Next year it's planning to produce 800-870,000t, while iron ore will clock in at 343-366Mt, including 5-10Mt from the first full year of production at Simandou in Guinea.

The big promise is Rio, falling behind BHP on cost performance especially in iron ore, will trim costs to unlock capital over the next six years, down 4% on a copper equivalent basis from 2024-2030.

Decarbonisation capex has followed the lead of BHP, being slashed from US$5-6bn to US$1-2bn by 2030, with medium term capex to come down from US$11bn in 2025 to up to US$10bnpa over the mid term.

Decarb spend has been taken off balance sheet by enabling third-party investments in renewable energy.

The claim is Rio has already taken US$650m of costs out of the business since Trott took over, "half of it banked".

The target is a rise in EBITDA of 40-50% by 2030 based on long-run consensus prices, with 20% copper equivalent production growth.

On the copper side specifically, Rio Tinto is targeting 1Mtpa of copper production by 2030 with the development of the Oyu Tolgoi underground in Mongolia now complete and plans to extend mining at Kennecott in Utah beyond 2040.

Rio expects OT to produce 500,000tpa on average from 2028-2036. In its lithium business, it's trimmed its 2028 production profile for lithium from 250,000tpa LCE to 200,000tpa LCE, with any growth beyond that to depend on market fundamentals.

The ASX 300 Metals and Mining index rose 3.37% over the past week.

Which ASX 300 Resources stocks have impressed and depressed?

Making gains 

Develop Global (ASX:DVP) (copper) +21.8%

Predictive Discovery (ASX:PDI) (gold) +20.4%

Greatland Resources (ASX:GGP) (gold) +14.3%

Kingsgate Consolidated (ASX:KCN) (gold) +11.3%

Eating losses 

Vulcan Energy Resources (ASX:VUL) (lithium) -10.5%

Liontown Limited (ASX:LTR) (lithium) -8.9%

Pantoro (ASX:PNR) (gold) -6.2%

PMET Resources (ASX:PMT) (lithium) -5.6%

Develop Global rose as copper prices hit an all-time high, while PDI lifted as Perseus Mining (ASX:PRU) gazumped a bid from Robex Resources Inc (ASX:RXR) for the Guinea gold developer, and Greatland lifted after its Havieron feasibility study surprised to the upside on costs.

Vulcan sank after a big capital raising to fund its Lionheart lithium project in Germany, while Pantoro suffered from a share sale by major shareholder Tulla Resources following Kevin Maloney's decision to leave the Norseman gold mine owner's board.

Originally published as Monsters of Rock: Harder, better, faster, stronger – mining giants put copper front and centre