From the WSJ:
Days after Glencore PLC closed its 2013 purchase of Xstrata PLC in the largest mining deal ever, Chief Executive Ivan Glasenberg called it “a big play” on the commodity he arguably knew best: coal.
“To really screw this up, the coal price has got to really tank,” he said in an interview.
Since then, coal prices have fallen about 25%.
…China’s appetite for coal has weakened, with its consumption and production falling in 2014 for the first time in 14 years. U.S. demand is also waning as power plants shift to natural gas, and exports from coal-producing countries such as Russia, Colombia and Australia are on the rise, analysts say. Prices have fallen to near six-year lows, hovering between $60 and $65 a ton, down from more than $80 when the Xstrata deal closed in May 2013, according to spot prices tracked by Platts.
GLEN needs RIO much more than the reverse, and that’s saying something!