Key products and markets

Xstrata produces and sells exchange-traded base and precious metals, and bulk commodities where prices are negotiated on longer-term contracts. Xstrata’s customer base consists principally of large industrial concerns.

Xstrata Alloys

Xstrata Alloys is currently the world’s largest and amongst the lowest cost integrated ferrochrome producers in the world (through the Xstrata-Merafe Chrome Venture), one of the world’s largest producers of primary vanadium and a growing producer of platinum group metals. Over 80% of the world’s ferrochrome is utilised in the production of stainless steel and is sold on long-term contracts. The principal end-use of vanadium is as an alloying agent in steel. Xstrata produces vanadium pentoxide and ferrovanadium, which are sold to a diversified international customer base. Platinum Group Metals (PGMs) comprise platinum, palladium, rhodium, iridium, ruthenium and osmium. PGMs are used in auto catalysts and fuel cells, providing cleaner energy. Other key markets include jewellery and industrial and consumer products. Further information on ferrochrome, vanadium and PGM markets is available on Operating Review Alloys.

Xstrata Coal

Xstrata Coal is the world’s largest exporter of thermal coal, used to generate electricity in coal-fired power stations. Xstrata is also one of the largest producers of export semi-soft coal and among the top five producers of export coking (or metallurgical) coal, used in steelmaking. Around 90% of Xstrata’s coal production is exported, with the remainder sold to domestic Australian and South African markets. Sales of coal are primarily through annually renewable long-term contracts, with some sales concluded on the spot market. Xstrata’s Australian thermal coal operations supply major power generation companies in the Asia-Pacific region, while our Australian metallurgical coal mines supply major steelmakers worldwide. Xstrata’s South African coal operations largely supply the Atlantic thermal coal market, where Europe is the major export destination. In Colombia, Xstrata has recently acquired Prodeco and also owns a one-third stake in the Cerrejón mine, both of which export high grade thermal coal to Europe and the Americas. Further information on coal markets is available on Operating Review Coal.

Xstrata Copper

Xstrata Copper is a fully-integrated producer of copper metal and concentrate and is one of the world’s five largest producers of mined copper. Xstrata’s excess copper concentrate production is sold to custom copper smelters in South America, Asia and Europe, with over 90% sold under contracts and the remainder sold on the spot market. Xstrata Copper’s refined copper metal cathodes are sold to producers of industrial products and traders in major copper consuming regions. North America accounted for approximately 53% of total sales in 2008, with the remainder sold to customers in Europe and Asia. Cathodes are predominantly used in the manufacture of copper wire rod for electrical conductor applications. Further information on copper markets is available on Operating Review Copper.

Xstrata Nickel

Xstrata Nickel is one of the world’s five largest producers of nickel and one of the largest recyclers and processors of nickel and cobalt-bearing materials. Xstrata Nickel’s Nikkelverk refinery in Norway produces very high grade purity nickel and cobalt from material sourced from Xstrata Nickel’s mining operations in Canada and Australia. Ferronickel from Xstrata’s Falcondo operation (currently suspended) is sold into the stainless steel market. The high grade nickel produced at Nikkelverk is typically sold into first end-use applications such as high nickel alloys, superalloys, low alloy steel, foundry and electroforming. Cobalt from Nikkelverk is typically sold into such end-use applications such as aerospace, land-based turbines and electronics. Further information on nickel markets is available on Operating Review Nickel.

Xstrata Zinc

Xstrata Zinc is a fully integrated producer of mined zinc and lead concentrate, zinc and lead metal and silver. Around half of all zinc metal produced globally is used to galvanise steel, an environmentally friendly way of protecting steel against corrosion. Zinc is also used in the manufacture of die-cast alloys, brass and the production of zinc oxides and chemicals. The majority of Xstrata’s zinc metal production is sold under term contracts to the EU, Canada and the US. Zinc concentrates are sold mainly to Japan, South Korea, China, Australia and Europe. Further information on zinc markets is available on Operating Review Zinc.