Glencore plc – Annual report – 31 December 2025
Industry: mining
1. Accounting policies (extract)
Climate change-related considerations
The Group’s 2024-2026 Climate Action Transition Plan outlines its industrial emissions (Scope 1, 2 and 3) reduction targets, relative to a restated 2019 baseline, of 15% by the end of 2026, 25% by the end of 2030 and 50% by the end of 2035, and its ambition to achieve, subject to a supportive policy environment, net zero industrial emissions by 2050. Following the approval of our 2024-2026 Climate Action Transition Plan, we completed the acquisition of a 77% interest in Elk Valley Resources (EVR). We are planning to incorporate EVR into our next Climate Action Transition Plan, recognising that the transition away from steelmaking coal for steel production will be slower than energy coal, as well as the limitations of existing technology to address Scope 3 emissions in the steelmaking sector.
We recognise that to achieve our 2050 net zero industrial emissions ambition there is a need for significant global technological evolution and advancement, and coordinated and supportive government policies, including incentives to drive accelerated uptake of lower-carbon and decarbonisation technologies, and market-based regulations governing industrial practices that drive a competitive, least-cost emissions reduction approach, most of which are not within our direct control or ability to materially influence but are critical to our ability to achieve our net zero industrial emissions ambition by the end of 2050. Our long-term ambition is therefore subject to such a supportive policy environment and, for that reason, we have expressed it as an ambition rather than a target, which is more appropriate for activities and actions deemed within our direct control.
The accounting-related measurement and disclosure items that are most impacted by our targets and initiatives, and climate change risk more generally, relate to those areas of the financial statements that are prepared under the historical cost convention and are subject to estimation uncertainties in the medium to long term. Climate change impacts can also introduce more volatility in assets and liabilities carried at fair value. Future changes to the Group’s climate change strategy or realisation of global decarbonisation ambitions quicker than currently anticipated may impact some of the Group’s significant judgements and key estimates and result in material changes to financial results and the carrying values of certain assets and liabilities in future reporting periods. The Group’s current climate change strategy is reflected in the Group’s significant judgements and key estimates, and therefore the Financial Statements, as follows:
(i) Property, plant and equipment and Intangible assets – estimation of the remaining useful economic life of assets for depreciation and amortisation purposes
Property, plant and equipment and intangible assets are depreciated/amortised to estimated residual values over the estimated useful lives of the specific assets concerned, or the estimated remaining life of the associated mine, field or lease, using a straight-line or a units of production over recoverable reserves method. The estimated useful lives of our specific assets and/or operations (and therefore the rate of depreciation/amortisation) aligns with our climate change targets and ambition. Property, plant and equipment and intangible assets policies are further covered below and within impairment and impairment reversal estimation uncertainties, together with key estimates and sensitivities pertaining to a reasonably possible change in the realisation of global decarbonisation ambitions, which could also change the useful economic lives of the related assets.
(ii) Restoration, rehabilitation and decommissioning provisions – estimation of the timing of closure and rehabilitation activities
A provision for future restoration, rehabilitation and decommissioning costs requires estimates and assumptions to be made around the relevant regulatory framework, the magnitude of the possible disturbance and the timing, extent and costs of the required closure and rehabilitation activities. Many of these rehabilitation and decommissioning events are expected to take place when the underlying commercial reserves are extracted and the operations move into closure mode. Our current estimates of the timing of these closure activities align with the trajectory of our industrial emissions reduction targets and ambition.
Sensitivities pertaining to a reasonably possible change in the realisation of global decarbonisation ambitions (i.e. the timing of the restoration, rehabilitation and decommissioning costs) of our fossil fuel-related obligations are outlined below in the key estimation uncertainty – restoration, rehabilitation and decommissioning costs.
(iii) Property, plant and equipment and Intangible assets (including the carrying value of goodwill in our coal marketing CGU) – estimation of the valuation of assets and potential impairment charges or reversals
The Group acknowledges that there is a wide range of possible energy transition scenarios, including those aligned with the Paris Agreement goals, that would indicate different outcomes for individual commodities. The decarbonisation transition could result in increasing or decreasing demand for the Group’s various commodities, due to policy, regulatory (including carbon pricing mechanisms), legal, technological, market or societal responses to climate change. On the negative side, these may result in some or all of a cash-generating unit’s reserves becoming uneconomic to extract and/or our coal marketing CGU no longer being able to generate returns and realise the benefits of its associated goodwill balance.
We use actual carbon prices where they exist to assess the sensitivity of our industrial assets to possible future carbon prices in order to assess the potential impacts on investment decisions as well as commodity-specific operating cost curves and related supply/demand outcomes, arising from existing and future potential carbon pricing regulation. A key component of this analysis is to understand the potential development of a range of underlying cost curve structures over time and to consider, identify and make reasonable judgements, on the extent to which costs are likely to be passed onto the end user. Our analysis shows that under the IEA’s NZE 2050 scenario, marginal supply costs would increase by at least 10% to potentially over 60%, for the range of our most relevant and material commodities. We expect the rising cost of carbon will increase operating costs, increasing the cost of production, which, in turn, would ordinarily be passed on to end users through increased commodity prices. In fact, first and second quartile (below average) emission intensity producers, where we see the weighted average of our portfolio residing, are likely to see margin expansion.
Notwithstanding the above, for energy coal and other fossil fuels, should global decarbonisation ambitions materialise along the IEA’s Stated Policies Scenario or other more ambitious net zero scenario, essentially an accelerated displacement of energy coal and other fossil fuels as an energy source, the potential impact on the current carrying value of these cash-generating units is outlined below in the key estimation uncertainty – impairments and impairment reversals (Sensitivity to demand for fossil fuels). It should be noted that, under accelerated emission reduction scenarios, we would expect to see positive valuation developments within our industrial production portfolio exposed to the metals currently required to deliver such rapid decarbonisation scenarios, including copper, nickel and cobalt.
Critical accounting judgements and key sources of estimation uncertainty (extract)
Critical accounting judgements (extract)
(v) Impact of carbon pricing
In determining accounting estimates such as the recoverable amount of non-current assets, the Group has largely assumed that future increases in carbon costs will be reflected in commodity prices and therefore passed onto the end consumer. No material change to the Group’s related accounting estimates is expected within the next financial year as a result of this judgement.
Key sources of estimation uncertainty (extract)
(ii) Impairments and impairment reversals (note 7)
Investments in associates and joint ventures, advances and loans, property, plant and equipment, and intangible assets are tested for impairment when events or changes in circumstances indicate that the carrying amount of an individual asset or cash generating unit (CGU) may not be recoverable. CGUs to which goodwill or other indefinite life intangible assets are allocated are tested at least annually. Indicators of impairment include changes in operating or economic assumptions, revisions to reserves or mine plans, updates to supply, demand and price forecasts, and emerging risks such as climate change and the transition to a low carbon economy. An impairment loss is recognised in the consolidated statement of income when an asset’s or CGU’s recoverable amount is below its carrying amount. For assets or CGUs impaired in prior periods, a reversal is recognised when the recoverable amount exceeds the carrying amount. Recoverable amounts are based on discounted future cash flows using asset or CGU specific discount rates. Estimates reflect expectations about future operations and our industrial emissions reduction targets and long term ambition. They incorporate a mix of internal information and market participant inputs, including production and sales volumes, commodity prices (current levels, forward curves and trends, including the global climate trajectory), enacted carbon taxes, reserves and resources, operating costs and capital expenditure. Management reviews these estimates regularly. Changes in key assumptions, particularly a deterioration in the commodity pricing outlook, may reduce recoverable amounts and lead to impairment. Conversely, a materially improved pricing outlook or increased service potential may result in the reversal of previous impairments. All impacts are recognised in the statement of income.
In the current year, the review identified indicators of impairment or impairment reversal for various CGUs, including those arising from changes in the underlying commodity price environment most relevant to the respective operation. The Group assessed the recoverable amounts of these CGUs and as at 31 December 2025, except for those CGUs disclosed in note 7, their estimated recoverable amounts exceeded their carrying values. For certain CGUs where no impairment was recognised, but where headroom is limited, a significant deterioration or improvement in key assumptions could result in a material impairment or reversal within the next financial year. A summary of the carrying values, the key or most sensitive assumptions, and the estimated impact of reasonably possible changes in those assumptions for each CGU with limited headroom relative to its recoverable amount, is presented below. In presenting the sensitivity analysis, particularly for commodity price assumptions, a 10% change has generally been applied, as this reflects the commonly used industry benchmark. Where a different percentage is considered reasonably possible for a specific operational assumption, this has been highlighted accordingly.
1 Capital employed includes property, plant and equipment, non-current inventory, less rehabilitation provisions and net deferred tax liabilities.
2 Discount rates expressed on a real-terms, post-tax basis.
3 Across the curve.
4 Cobalt hydroxide price.
5 Illustrated impairment reversal capped at level of accumulated historical impairment, adjusted for notional depreciation since the impairment was charged. The downside sensitivities for the Astron Oil CGU take into account the headroom over carrying value, post partial reversal of impairment in 2023.
This headroom is sufficient to absorb the impact of a 1% change in discount rate, hence no sensitivity is presented.
Climate change (additional illustrative disclosures)
The disclosures in note 7 related to sensitivities to key assumptions for CGUs that have been impaired in the period, together with the above disclosures related to CGUs with limited headroom, consider the effects of reasonably possible changes in key assumptions for the next financial year.
All other sensitivities below are reasonably possible changes in assumptions beyond the next financial year, and are therefore not considered key sources of estimation uncertainty at the reporting date.
Energy fossil fuels industrial operations
Our base case price assessment takes into account the short-, medium- and longer-term seaborne energy coal demand outlook. Achieving our net zero ambition by the end of 2050 assumes significant global technological evolution and advancement, and coordinated and supportive government policies, including incentives to drive accelerated uptake of lower-carbon and decarbonisation technologies, and market-based regulations governing industrial practices that drive a competitive, least-cost emissions reduction approach, most of which are not within our direct control or ability to materially influence. In particular, economic and regulatory incentivisation of such shift, whether through carbon pricing and/or incentives to drive accelerated uptake of lower-carbon and decarbonisation technologies, could result in different financial results on the same tonnage profile.
Our assessment applies a value in use methodology. Glencore continues to progress selective brownfield coal extensions or expansions at existing mines as included in our life of mine plans, while continuing to be a responsible steward of these assets, as we progress the phase-down of our global coal portfolio. We assume that through the remaining life of mines, there will continue to be a market for energy coal at a real Newcastle FOB export price of $113/tonne (6,000 NAR), South African FOB export price of $97/tonne and Colombian FOB price of $91/tonne, which represents our best current estimate of long-term pricing based on our view of projected likely supply and demand fundamentals and the industry cost structure.
Notwithstanding these assumptions, we present illustrative impairments arising under alternate price scenarios. The 2025 price sensitivities are informed by the IEA’s latest World Energy Outlook 2025 (WEO 2025) climate scenarios, described below:
- IEA’s Current Policies Scenario (CPS) (WEO 2025 prices) – a pathway based on policies and regulations that are already in place, with a cautious perspective on the speed at which new energy technologies are deployed and integrated into the energy system
- IEA’s Stated Policies Scenario (STEPS) (WEO 2025 prices) – a pathway based on the application of a broader range of policies, including those that have been formally put forward but not yet adopted, and assuming faster uptake of new technologies than in CPS;
- • IEA’s Net Zero Emissions by 2050 Scenario (NZE) (WEO 2025 prices) – a pathway for the global energy sector to achieve net zero emissions by 2050.
In addition, for illustrative purposes, we have shown a Complete Displacement Scenario (CDS) – reflecting the impact of fossil fuels being immediately displaced as an energy source and the resulting immediate fall in commodity prices to zero.
Our life of mine planning reflects operating cash flows which are consistent with achieving our industrial emissions reduction targets and progression towards our 2050 net zero emissions ambition. Overall our industrial portfolio’s energy coal production is heavily weighted towards the earlier part of these time frames. Based on the life of mine plan and remaining energy coal production as at 31 December 2025, we have illustrated this by showing the year in which 50% and 80% of saleable energy coal would be expected to be extracted under our current plans, being 2032 and 2038, respectively. If and while there is demand for coal, and it is economic to do so, we plan to continue to operate our mines to the end of their economic life and in accordance with our climate strategy.
The sensitivities are presented on price alone and assume no mitigating actions; therefore the impairments in each scenario are likely higher than would transpire. In practice, in a sustained low price environment, management would alter mine plans to cut operating and capital costs, potentially at the expense of future volumes, in order to reduce the overall NPV impact.
The CPS, STEPS and NZE sensitivity prices adopted are those included in the documentation to WEO 2025, except that IEA energy coal prices are on a delivered basis. These have been adjusted to FOB pricing on the basis of forward freight costs. Furthermore, in determining the Colombian FOB price, we have used a weighting of the IEA coastal China and IEA European Union prices to take into account that Colombian coal sold from Cerrejón is likely to be delivered to a combination of different markets in the future.
Other fossil fuel-related capital employed NPV sensitivities
Climate change – property, plant and equipment and intangible assets – estimation of the remaining useful economic life of assets for depreciation and amortisation purposes
Property, plant and equipment and intangible assets are depreciated/amortised to estimated residual values over the estimated useful lives of the specific assets concerned, or the estimated remaining life of the associated mine, field or lease, using a straight-line or a units of production over recoverable reserves method. The estimated useful lives of our specific assets and/or operations (and therefore the rate of depreciation/amortisation) aligns with, and reflects, our industrial emissions reduction targets and ambition. The current carrying value of our property, plant and equipment and intangible assets related to our fossil fuels operations is $27,654 million, and the depreciation/amortisation related to these balances recognised in 2025 was $2,955 million, implying an average accounting-determined useful life of c.9 years.
(iii) Restoration, rehabilitation and decommissioning costs (note 23)
A provision for future restoration, rehabilitation and decommissioning costs requires estimates and assumptions to be made around the relevant regulatory framework, the magnitude of the possible disturbance and the timing, extent and costs of the required closure and rehabilitation activities. Most rehabilitation and decommissioning activities are expected to occur many years in the future. The estimates of the requirements and costs that will need to be met when these activities take place are inherently uncertain and may change materially over time.
In calculating the appropriate provision for the expected restoration, rehabilitation and/or decommissioning obligations, cost estimates of the future potential cash outflows based on current studies of the expected rehabilitation activities and timing thereof, are prepared. These forecasts are then discounted to their present value using a risk-free rate specific to the liability and the functional currency of the respective operation.
Any changes in the risk-free rate or expected future costs are initially reflected in both the provision and the asset and subsequently in the consolidated statement of income over the remaining economic life of the asset. A material change in the provision within the next financial year could arise from changes in risk-free rates, refer to the sensitivity analysis in note 23. As the actual future costs can differ from their estimates due to changes in laws, regulations, technology, costs and timing, the provisions, including the estimates and assumptions contained therein, are reviewed regularly by management. The aggregate effect of changes within the next financial year as a result of revisions to cost and timing assumptions could be material. It is impracticable to disclose the extent of possible effects of a change in cost and timing assumptions as the assumptions are specific to individual assets.
Climate change sensitivities
As noted above, while it is not a reasonably possible change we expect over the next financial year, global ambitions seeking to drive quicker decarbonisation could result in the timing of restoration, rehabilitation and decommissioning costs related to our coal and oil closure obligations being accelerated. As at 31 December 2025, the non-current rehabilitation provision related to our coal and oil operations is $9,278 million (undiscounted) and $5,511 million (current carrying value). The weighted average maturity is 28 years.
The portion related to operating energy coal mines is $3,617 million (undiscounted) and $2,272 million (discounted). The weighted average maturity is 12 years. To illustrate the effect of quicker decarbonisation, a three-year and five-year weighted average acceleration of energy coal mines rehabilitation, with no changes to the total undiscounted cash flows, would result in an increase to the provision of $192 million and $313 million, respectively.
7. Impairments
1 Impairments recognised during the year are allocated to Glencore’s operating segments as follows: Marketing activities impairments of $297 million (2024: reversal of impairments of $38 million) and Industrial activities impairments of $892 million (2024: $2,304 million).
As part of its regular portfolio review, Glencore assesses whether indicators that a cash-generating unit (CGU) or asset may be impaired exist, or whether a previously recognised impairment may no longer be required.
The recoverable amounts of property, plant and equipment and intangible assets were determined using fair value less costs of disposal (FVLCD) or, in certain cases, value in use (VIU). Both FVLCD and VIU were estimated using discounted cash flow models based on the most recently approved financial budgets, supported by each operation’s life of asset plans. The models incorporate a combination of internal information and market participant inputs, including the latest reserve and resource estimates, relevant operating and capital cost assumptions, and, where available, market forecasts for commodity prices and foreign exchange rates. Cash flows were discounted using operation specific post-tax real discount rates ranging from 8.0% to 15.1% (2024: 7.6% to 14.2%). The valuations are most sensitive to commodity price assumptions, and changes in pricing outlook may result in further impairments or reversals. Both FVLCD and VIU used Level 3 valuation techniques in each year. Sensitivity analysis was performed on commodity price assumptions using a 10% change, reflecting a typical industry deviation parameter, and on discount rates using a 1% variation, representing a reasonable range given current economic conditions. Where higher sensitivities are reasonably possible for specific operational assumptions, these have been identified accordingly.
The following significant impairment charges were recognised following the impairment assessment:
2025
Property, plant and equipment and intangible assets
1 Estimated recoverable capital employed, post impairment. Capital employed includes property, plant and equipment, non-current inventory, less rehabilitation provisions and net deferred tax liabilities.
2 Discount rates expressed on a real terms, post-tax basis.
3 Across the curve.
4 Illustrated impairment reversal capped at level of accumulated historical impairment, adjusted for notional depreciation since the impairment was charged. Historical impairments at the Mount Isa Zinc and McArthur River CGUs have been fully reversed, hence no further impairment reversal is possible. Similarly, the downside scenarios for Mount Isa Zinc and McArthur River take into account the headroom over carrying value, post-reversal of impairment. This headroom is sufficient to absorb the impact of a 1% change in discount rate, hence no sensitivity is presented.
- $859 million, Cerrejón coal CGU (Industrial activities segment). In March 2025, Cerrejón announced the reduction of production by 5-10 million tonnes per annum, reflecting an oversupplied Atlantic seaborne thermal coal market.
- $378 million, Coal SA CGU (Industrial activities segment). The South African rand strengthened significantly against the US dollar during 2025. As the CGU’s functional currency is ZAR, this resulted in a higher carrying value of capital employed when translated in US dollar terms. However, as the CGU’s revenue is heavily US dollar denominated, there was no corresponding uplift in expected cash flows, accounting for the majority of the impairment.
- $88 million, Ferroalloys CGU (Industrial activities segment). In H1 2025, the Boshoek and Wonderkop smelters were suspended following a review of the sustainability of the Ferroalloys business’s smelting operations. The decision reflected continued weakness in the ferrochrome market, which rendered ongoing production at these facilities uneconomic. As a result, the property, plant and equipment associated with these smelters were fully impaired. The wider CGU remains unimpaired; accordingly no sensitivity analysis is presented.
Reversal of impairment:
- $132 million reversal of impairment, Mount Isa Zinc CGU (Industrial activities segment), and $41 million reversal of impairment, McArthur River Zinc CGU (Industrial activities segment). Following the improvement in zinc and precious metal prices, the Group reversed the remaining impairments previously recorded for these CGUs.
- The balance of net impairment reversals of $26 million on property, plant and equipment reflects an impairment reversal of $13 million in the Marketing activities segment and $13 million in the Industrial activities segment. No items were individually material. These movements mainly reflect assets no longer required for use or projects discontinued following changes in production and development plans, as well as reversals arising from remeasurement to fair value less costs to sell.
Inventory and other
$261 million reversal of impairment on inventory and other. Certain ore stockpiles containing copper and cobalt at the KCC CGU (Industrial activities segment) were impaired in 2022 ($113 million) and 2024 ($148 million). Following the recent improvement in metal prices, these stockpiles have been reassessed as fully recoverable, and the previously recognised impairments have been reversed in full.
Advances and loans current and non-current
Net impairments of $324 million were recognised on advances and loans following adverse changes in the financial position of multiple counterparties, with no single impairment considered individually material.
2024
Property, plant and equipment and intangible assets
1 Estimated recoverable capital employed, post impairment. Capital employed includes property, plant and equipment, non-current inventory, less rehabilitation provisions and net deferred tax liabilities.
2 Discount rates expressed on a real terms, post-tax basis.
3 Across the curve.
4 The estimated recoverable value of Koniambo and Custom Zinc/Copper metallurgical operations was estimated to be de minimis. No reasonably possible change in assumptions would materially impact this value, hence no sensitivity analysis was presented.
5 Illustrated impairment reversal capped at level of accumulated historical impairment, adjusted for notional depreciation since the impairment was charged.
- $611 million, South Africa Coal CGU (Industrial activities segment). Due to weaker non-Pacific demand, export growth from Indonesia and stronger LNG supply growth, thermal coal price forecasts trended lower over H1 2024. As a result, our long-term South African coal export price assumption (API4) reduced from $118/t to $95/t (down 19%). These lower price assumptions, together with ongoing export logistics challenges, significantly impacted Coal SA’s expected overall returns.
- $553 million, Koniambo CGU (Industrial activities segment). On 12 February 2024, we announced that Koniambo would transition to care and maintenance, with Glencore continuing to fund the business over a six-month period to support the critical activities required to maintain integrity of the assets, while running a process to identify a potential new industrial partner and/or possibly an outright sale. Given the continuing challenging nickel market environment, the remaining property, plant and equipment ($279 million) and related spare-parts inventory ($140 million) were fully impaired. Contract termination and employee severance related costs of $134 million (see note 6) were recognised.
- $1,487 million, various custom zinc and copper metallurgical operations (Industrial activities segment). Over 2024, zinc and copper metallurgical economics came under extreme pressure as increasing smelter capacity, coupled with constrained zinc and copper concentrate markets and mine supply, drove smelter treatment charge (TC) revenue streams to record lows and at times, even negative. Over the short- to medium-term, it was anticipated that mine supply will continue to be constrained and as a result, the valuations of the above custom metallurgical operations were fully impaired, with their longer-term business cases being strategically evaluated. To this effect, property, plant and equipment related balances at each of the operations, totalling $1,401 million, were fully impaired and an inventory impairment of $86 million was recognised.
Reversal of impairment:
- $579 million impairment reversals at various zinc and lead mining operations (Industrial activities segment). As noted above, 2024 was characterised by record low zinc and copper TC realisations. Contrary to custom metallurgical operations, a low TC outlook is a positive development for zinc/lead and copper concentrate producing mines. As a result, estimated valuations for our zinc mines, that were previously impaired, increased and partial reversals of the previous years’ impairments were recognised.
- The balance of impairment charges of $230 million on property, plant and equipment (none of which were individually material) relate to specific assets ($216 million in the Industrial activities segment and $14 million in the Marketing activities segment) where utilisation was no longer required or to projects no longer progressed due to changes in production and development plans.
Advances and loans current and non-current
A net impairment charge of $44 million was recognised on advances and loans, with no single item considered individually material. The net movement reflected changes in the financial position of several counterparties and the final settlement of selected outstanding loans. This included an $8 million impairment within Industrial activities and a $52 million impairment reversal within Marketing activities.
Accounts examples 