Glencore PLC (LON:GLEN) reported a significant 19% year-on-year increase in copper production for the first quarter of 2026, with the vast majority of that growth coming from its operations in the Democratic Republic of Congo (DRC). The company's Kamoto Copper Company (KCC) and Mutanda mines contributed 27,400 tonnes of the total 31,700-tonne group increase, representing a 86.4% share. This heavy reliance on the DRC exposes Glencore to heightened regulatory and operational risks as the country's mining sector faces a potential overhaul of its legal framework.
The DRC's Chamber of Mines has called an emergency three-day forum starting July 15 to discuss a draft bill that would amend more than 40 sections of the 2018 mining code. The proposed legislation would grant the state greater control over strategic minerals, empower the government to suspend mining permits, impose fines of up to $1 million, and introduce prison sentences of up to 20 years for violations. The chamber warned that the speed of the revision process risks excluding mining operators from meaningful input.
This policy uncertainty follows a recent tax dispute that led Congolese authorities to close Glencore's offices last week. The company confirmed it is in discussions with officials and denied any misconduct. Cabinet minutes from a meeting after the raid indicated President Félix Tshisekedi instructed agencies to use force only as a last resort, emphasizing the need for a stable legal environment and predictable administrative decisions. The presidency did not confirm whether the order was directly related to Glencore.
Glencore's copper production in the first quarter of 2026 reached 31,700 tonnes from the same period in 2025, driven primarily by KCC and Mutanda. Other contributors included the Antamina mine in Peru, which added 13,500 tonnes, while the closure of the Mount Isa mine in Australia subtracted 8,900 tonnes. The company's overall copper output for 2025 was 851,600 tonnes, with the DRC mines accounting for 247,800 tonnes, or 29.1% of total production.
The shift toward copper production in the DRC is partly due to cobalt export quotas, which have prompted the mines to focus on copper while maintaining sufficient cobalt inventory to meet short-term quota needs. This strategic pivot underscores Glencore's reliance on the region for its copper growth ambitions.
Glencore's stock slipped 0.3% to 528.60 pence by 10:01 BST on Wednesday, a smaller decline than those of peers Anglo American plc (LON:AAL) and Antofagasta plc (LON:ANTO), which fell 0.84% and 1.69%, respectively. The relative resilience may reflect the market's perception of the dispute as a policy issue rather than an immediate operational threat, though investors remain cautious.
Glencore has a potential buffer in the form of a deal with a U.S.-backed group led by Orion, which agreed in principle to acquire a 40% stake in KCC and Mutanda for approximately $9 billion, including debt. The deal would see Glencore continue to operate the assets. CEO Gary Nagle described the consortium as "the only major Western producer of copper and cobalt in the DRC."
Looking ahead, Glencore expects a stronger second half of 2026, with 52% of its full-year copper output projected in H2, supported by improved ore grades and water availability at the Collahuasi mine in Chile. The company maintains its 2026 production guidance of 810,000 to 870,000 tonnes. However, if Collahuasi underperforms or if DRC regulations and taxes remain challenging, the bulk of the recovery will still depend on the same two African operations.
Key milestones to watch include the conclusion of the industry forum on July 17, Glencore's half-year production report on July 29, and its earnings release on August 5. Investors will be closely monitoring whether the DRC remains the primary source of additional copper and whether the Orion deal progresses from a memorandum of understanding to binding terms.
