So now that Glenstrata is a go, should we be concerned?

The good news is that when it comes to transparency, bigger is (normally) better.

Vows have been declared and permission granted; the ceremony is set for the marriage of the two largest names in commodities – Glencore and Xstrata. The $76 bn merger to create Glenstrata is the largest in the industry’s history and yesterday was finally approved by the Chinese Ministry of Commerce (Mofcom).

Previously, I wrote of how governments were fretting at the deal. Since it was first announced in February 2012, many have vented their disapproval of a marriage between the two largest commodities companies in the world. The deal was held up by Qatar, South Africa, the EU and China. At each hurdle, Glencore – the one wearing the trousers in this relationship – was forced to pay a little bit extra, or sell a few more businesses.

Yesterday’s announcement was no different: Glencore was forced to sell Las Bambas, a big copper project in Peru. The decision was inevitable from a Chinese point of view: Glenstrata would control over 10 percent of the world’s copper concentrate supplies and China is the world’s largest copper consumer.

So now that Glenstrata is a go, should we be concerned? Will Glenstrata be the Ayatollah or the Mandela of the world’s commodities? The word monopoly is too easily deployed, but when one company dominates so many essentials – thermal coal, ferrochrome, zinc and copper to name a few – there is reason for concern.

The world of commodities is traditionally discreet. An earlier blog I wrote on Marc Rich, Glencore’s founder, shows just how suspect it can be. Price fixing, sanctions busting, illicit trading are all buzz words surrounding the industry, let alone the environmental and human rights issues that follow mining companies into the darkest corners of the earth.

But there is good news. When it comes to transparency, bigger is (normally) better. The larger the company and the more stock exchanges on which it is required to report to generally means that it is forced to clear up its act. Just look at ENRC’s move out of the Congo in December, when it was accused of entering a dodgy partnership with the suspicious mining billionaire Dan Gertler.

More good news for transparency came the same day that the Glencore-Xstrata deal was approved. Greg Page, chief executive of the trading house Cargill, advised the commodities industry to embrace greater transparency: “The industry, as a whole, must accept its responsibility to behave appropriately, properly, ethically,” Page said. “There are lessons to be learnt from the banking sector, and the forced legislation it prompted and is continuing to prompt.”

The marriage of Glencore and Xstrata is now scheduled for 2nd May. Let’s hope the honeymoon precedents a new era of transparency.

Photograph: Getty Images

Oliver Williams is an analyst at WealthInsight and writes for VRL Financial News

Ukip's Nigel Farage and Paul Nuttall. Photo: Getty
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Is the general election 2017 the end of Ukip?

Ukip led the way to Brexit, but now the party is on less than 10 per cent in the polls. 

Ukip could be finished. Ukip has only ever had two MPs, but it held an outside influence on politics: without it, we’d probably never have had the EU referendum. But Brexit has turned Ukip into a single-issue party without an issue. Ukip’s sole remaining MP, Douglas Carswell, left the party in March 2017, and told Sky News’ Adam Boulton that there was “no point” to the party anymore. 

Not everyone in Ukip has given up, though: Nigel Farage told Peston on Sunday that Ukip “will survive”, and current leader Paul Nuttall will be contesting a seat this year. But Ukip is standing in fewer constituencies than last time thanks to a shortage of both money and people. Who benefits if Ukip is finished? It’s likely to be the Tories. 

Is Ukip finished? 

What are Ukip's poll ratings?

Ukip’s poll ratings peaked in June 2016 at 16 per cent. Since the leave campaign’s success, that has steadily declined so that Ukip is going into the 2017 general election on 4 per cent, according to the latest polls. If the polls can be trusted, that’s a serious collapse.

Can Ukip get anymore MPs?

In the 2015 general election Ukip contested nearly every seat and got 13 per cent of the vote, making it the third biggest party (although is only returned one MP). Now Ukip is reportedly struggling to find candidates and could stand in as few as 100 seats. Ukip leader Paul Nuttall will stand in Boston and Skegness, but both ex-leader Nigel Farage and donor Arron Banks have ruled themselves out of running this time.

How many members does Ukip have?

Ukip’s membership declined from 45,994 at the 2015 general election to 39,000 in 2016. That’s a worrying sign for any political party, which relies on grassroots memberships to put in the campaigning legwork.

What does Ukip's decline mean for Labour and the Conservatives? 

The rise of Ukip took votes from both the Conservatives and Labour, with a nationalist message that appealed to disaffected voters from both right and left. But the decline of Ukip only seems to be helping the Conservatives. Stephen Bush has written about how in Wales voting Ukip seems to have been a gateway drug for traditional Labour voters who are now backing the mainstream right; so the voters Ukip took from the Conservatives are reverting to the Conservatives, and the ones they took from Labour are transferring to the Conservatives too.

Ukip might be finished as an electoral force, but its influence on the rest of British politics will be felt for many years yet. 

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