Anglo American, a multinational diversified miner, has announced its expectations for reduced production in the coming year due to near-term constraints and volatile market conditions. However, the company also plans to lower costs by a staggering $1 billion.
In 2023, Anglo American experienced a 3% increase in output compared to the previous year. This growth was primarily driven by the ramp-up of operations at its Peruvian copper project, Quellaveco, and solid iron ore production. These positive developments helped offset the decline in platinum metals and diamonds production.
Looking ahead to the next year, Anglo American anticipates a 4% decrease in production, partly due to reduced output at its Kumba iron ore operations in South Africa.
Responding to the ongoing market volatility, particularly evident in the platinum metals sector, Anglo American aims to reduce costs by $1 billion in 2024. This strategic cost-cutting initiative is expected to result in a lower cost per unit in 2024 and a reduction of $1.8 billion in capital expenditure from 2023 to 2026.
Chief Executive Duncan Wanblad emphasized the company’s focus on safety, operational discipline, and capital allocation. In his statement preceding an investor briefing, he expressed optimism about the future, stating that the supply and demand dynamics for many metals and minerals are increasingly favorable.
Anglo American Platinum, the majority-owned platinum miner by Anglo American, disclosed plans to implement various measures aimed at reducing costs by approximately 5 billion South African rand ($266.5 million) annually. These measures include enhancing efficiencies, intensifying cost-saving initiatives, and reallocating capital.