That’s because of its earlier history as a commodities trading house, before the merger with Xstrata gave it ownership of a major global resource base. Its mix of mining, marketing and trading operations is unique and gives it unique understanding of its markets and unique opportunities to exploit its market intelligence.

At the heart of its coal strategy is the market influence provided by its own and third-party production and, in particular, its dominance of the premium coal that is the benchmark for pricing in the wider market.

By pursuing a depletion strategy rather than simply selling its mines to buyers that would keep producing and be motivated to increase production,Glencore has retained its hold on the market and its pricing power.

There are few new coal mines being developed anywhere in the world, and the flow of investment into expansion of existing mines has dwindled under the pressure from the global push – including by Glencore’s own shareholders – to reduce carbon emissions.

The likely permanent reduction in Russian coal exports from the response to its invasion of Ukraine will only add to the pressure on the supply side.

By pursuing a depletion strategy rather than simply selling its mines to buyers that would keep producing and be motivated to increase production, as many of its peers have done, Glencore has retained its hold on the market and its pricing power.

In the absence of (most unlikely) significant new mines, the prices will remain high and might even climb higher, even as Glencore withdraws volume from the market. Demand for coal is unlikely to peak before the end of this decade, if then, and will remain robust for several decades to come.

That will enable Nagle, and his successor, to finesse the relationship between Glencore’s declining volumes and prices to maximise profits.

Copper ambitions

Nagle provided a different insight into the strategy the company is pursuing in coal by describing Glencore’s copper ambitions in the briefing.

As with everyone else in the industry, Glencore expects a global structural shortage of copper in future as the growth in renewable energy technologies and electric vehicle fleets continues to surge. There is a lot of analysis predicting substantial shortfalls in copper production relative to the soaring demand.

Loading

The bullish outlook for the metal has seen a scramble by miners to position themselves via increased exploration and acquisitions, with BHP’s planned $9.6 billion takeover of Oz Minerals driven largely by a desire to put its foot on more copper reserves.

Thus far, however, the copper price hasn’t reflected the swelling forecasts on the metal’s future. It’s more than 20 per cent below its peak earlier this year.

Nagle has a potentially large new mine within his portfolio, the $US5.6 billion El Pachón mine in Argentina, as well as a number of opportunities to expand the company’s existing mines.

El Pachón, however, would be developed as “the last cab off the rank,” he said.

“When the price is there, when the world is screaming for the copper that it needs, that is when we will bring on the new supply.”

That’s another illustration of Glencore’s wider philosophy of maximising value over volume, and its caution about greenfield products that add volume in response to high prices and flatten or lower the price in the process. Glencore will expand its existing mines, if the demand warrants it, before it seriously considers bringing El Pachón into the market.

If the long-term outlook for copper is promising, then the long-term future of coal looks dire. Glencore is demonstrating, however, that it is possible to maximise profits from the fossil fuel regardless.

The Business Briefing newsletter delivers major stories, exclusive coverage and expert opinion. Sign up to get it every weekday morning.