What Possible Glencore, Xstrata Merger Means for Iron Ore

Reuters reported a merger between Glencore (LSE:GLEN) and Xstrata (LSE:XTA) will likely target iron ore as high margins tempt the potential mining behemoth.

As quoted in the market news:

Glencore and Xstrata, which have yet to reach a deal, would together rank as the world’s largest thermal coal exporter, the largest zinc producer and third-largest copper miner – but would remain all but non-existent in iron ore mining.

Xstrata wants to get into iron ore, underlined in 2009 by its attempt to buy mining giant AngloAmerican. But it has been thwarted by a scarcity of major new discoveries and a virtual oligopoly among mining giants Vale, Rio Tinto and BHP Billiton, which have no intention of loosening their grip, say industry players and analysts.

Click here to read the full Reuters report.