[Exclusive] Export-Import Bank to Promote Loans to Glencore, the World's Largest Resource Supply Chain Securing Company

Financial Support for Securing Raw Material Supply Chains

Payment on Behalf of Mineral Importing Companies

[Asia Economy Reporter Park Soyeon] The Export-Import Bank of Korea (KEXIM) has initiated efforts to secure resource supply chains using financial support to respond to sudden resource shortages in domestic industries amid the COVID-19 pandemic and tensions in Ukraine.

According to the financial investment industry on the 24th, KEXIM is promoting financial support in the form of a direct loan to Glencore, the world's largest resource development company based in Switzerland. This method involves KEXIM making payments for resource imports on behalf of Korean companies that import minerals.

This is part of KEXIM's "National Interest-Based Credit Activation Plan." The aim is to diversify the targets of resource-related financial support and to act as a direct trading party to secure raw material supply chains for domestic companies.

Glencore, the recipient of KEXIM's "love call," is the world's largest mineral company, owning mines worldwide and dealing in metals and minerals such as copper, cobalt, zinc, and lead.

KEXIM is particularly focused on securing cobalt, a key material for cathode active materials in secondary batteries. Glencore is the world's largest cobalt supplier, handling one-third of the global cobalt supply alone.

Glencore has recorded sales of $200 billion (240 trillion KRW) over the past five years. While it temporarily posted an operating loss of $4.1 billion in 2020 due to the COVID-19 pandemic, it turned to a profit of $5.9 billion last year thanks to rising mineral prices.

KEXIM is designing a detailed structure to provide strong incentives for Glencore to subscribe, leveraging its financial strength. Through this, KEXIM expects Glencore to supply mineral resources, including cobalt, to domestic companies in a long-term and stable manner.

KEXIM has been preparing financial support for Glencore since last year. With the recent conflict between Russia and Ukraine causing rapid instability in global resource supply chains, KEXIM is expected to accelerate support for K-industries using financial resources. There is a judgment that supply disruptions can occur at any time in non-ferrous metals.

A KEXIM official said, "The situation is difficult as prices of secondary battery raw materials such as lithium and cobalt have risen by 600% compared to last year," adding, "Since the government emphasizes the importance of resources so much, we are exploring even the slightest possibilities for resource-related financial support." He further stated, "The Glencore case is under review, and we are considering ways to provide incentives to Glencore, the counterparty."

Going forward, KEXIM plans to support economic normalization by providing financial support worth 15 trillion KRW for securing raw materials and expanding logistics infrastructure.

This content was produced with the assistance of AI translation services.