Glencore’s shares dropped by nearly a third yesterday to an all-time low on continued investor concerns about the effect of weak commodity prices on the mining and trading house.

Shares in the company traded as much as 31 per cent lower at 67p after one investment bank issued a dire warning on the risks for Glencore’s earnings outlook. The shares had earlier hit a new low of 66.67p and have been the biggest faller on the FTSE 100 this year, down more than 77 per cent.

Ivan Glasenberg, Glencore’s pugnacious chief executive, saw his 8.4 per cent stake drop below £1 billion in value for the first time since the company’s stock market listing in 2011.

Glencore’s shares have underperformed the broader mining sector this year because of the company’s high levels of debt, which now stand at almost double its market capitalisation of $16 billion.

Glencore says the company is being used by hedge funds as a proxy to bet against China, with money managers taking short positions in the miner because of its exposure to copper – one of the key building blocks of China’s decade-long industrialisation. Hedge funds have profited handsomely from betting against Glencore – “shorting” the miner-cum-trader has been one of the best performing trades in Europe this year.

Lansdowne Partners, one of the UK’s largest hedge funds, is reckoned to have made hundreds of millions of dollars from a short position in Glencore and has been telling its investors that miners will continue to suffer.

Investors have begun to question whether Glencore’s need to pay down its $30 billion net debt pile could lead to a further loss of value for shareholders. The company has already said it will suspend dividends for at least 12 months and is preparing asset sales.

Analysts at Investec warned that if commodity prices stayed at current levels, a much greater percentage of Glencore’s earnings would be needed to service its debt.