Mining group Anglo American has warned of a second multi-billion dollar writedown this year on its coal and iron ore assets, demonstrating the growing impact of sliding commodity prices. The charge of between $3 billion and $4 billion flagged on Thursday, to be taken in its first-half results, comes on top of a $3.9 billion writedown Anglo took for similar reasons in February, when it also posted a 25 percent drop in underlying operating profit for 2014.
Anglo, the fifth-biggest diversified global mining group by stock market capitalisation, is not alone in feeling the pinch of tumbling commodity prices. BHP Billiton said on Wednesday it will take a $2 billion impairment on its US shale operations, the third writedown in three years.
Anglo has been fighting the impact of struggling metals prices by trying to improve the efficiency of its mining operations and by selling less profitable assets, including coal mines in Australia. Both writedowns this year involved its recently launched Minas Rio iron ore mine in Brazil, plagued by delays and cost overruns since Anglo bought it in 2007-2008 for about $5.5 billion.
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