News just crossing the wires that UK mining firm Glencore may be looking to tie up a merger with Rio Tinto.
No further details as of yet but this could be very big news for the mining sector which has seen falls in commodity prices over the last few years.
Things have been hotting up in the mining world with BHP announcing that it is going ramp up Iron ore production by around 30% despite the collapse in ore prices recently.
Earlier on Glencore CEO Ivan Glasenberg came out and criticised the move
“If you look at the statement put out today by BHP Billiton, one of the world’s biggest iron-ore producers, saying they are going to expand production—it has already had an impact on prices—that is going to hurt Africa,”
I haven’t delved into the full details of the BHP announcement but it does seem a bit odd that they would ramp up production in the face of falling demand and prices. It smells more like some sort of play on trying to grab market share which could mean some aggressive moves between the mining companies. Certainly if the Glencore/Rio move happens they will, in effect, become the biggest mining operation in the world. I’m sure the competition regulators will be taking special note of what’s going on.
