Commodities Featured Article Iron ore price

Glencore strikes rich vein of stupid in Atlas buy

Monday, 9 May 2016

It’s a rich vein of stupid that runs through the mining sector right now. And here’s the latest:

Yes, Glencore has dug up a substantial stake in AGO for roughly $5 million by my calculations. Perhaps there is some flip strategy at work here because there is no way this zombie is going to make anyone any money long term. Here’s UBS’s latest cost curve:

Cash costs are lower of course but AGO is still doomed under $40 which is where we’re going before year end.

About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.