Switzerland-based Glencore, which also trades commodities, noted that it was well-positioned to support the transition to a lower-carbon economy with a portfolio that includes copper, cobalt, nickel, vanadium and zinc. The metals are important in the production of batteries, the cost and performance of which will likely be key in determining whether electric vehicles displace petrol- and diesel-fuelled vehicles.
Glencore said it believes that energy and mobility transformation "is a key part of the global response to the increasing risks posed by climate change". Coal, a key fuel for electricity production, is a major producer of carbon dioxide (CO2) emissions, a major driver of global warming.
Globally, coal use accounts for 40 percent of CO2 emissions and is on the rise after declining slightly from 2014 to 2016. Glencore said it agreed with international efforts to limit the rise in global temperatures while also ensuring universal access to affordable energy.
The pledge to limit its coal output to current levels comes after Glencore recently increased its footprint in the sector, buying stakes in a couple of coal mines sold by Rio Tinto in Australia. The integration of the Hail Creek and Hunter Valley should take Glencore's coal production to 145 million tonnes in 2019 from 129.4 million last year.
Glencore said it would begin in 2020 to publish long-term projections about reducing the intensity of emissions and mitigation efforts. It added it was on track with its pledge to reduce greenhouse gas emissions intensity by 5 percent by 2020 compared to 2016 levels.
Glencore also said it would review its membership in trade associations in line with its climate change positions. The coal announcement came as Glencore announced its 2018 net profits tumbled 41 percent to $3.4 billion (3 billion euros). However, the firm said its measure of operating profit - adjusted earnings before interest, tax, depreciation and amortisation costs - rose by 8 percent to a record $15.8 billion. The firm's commodity trading business saw its operating earnings fall by 17 percent to $2.4 billion, but mining rose 15 percent to $13.3 billion.