Anglo American has announced plans to cut 85,000 jobs over the next few years due to the crash in commodity prices hitting company profits.

The company plans to transfer some of the jobs through asset sales, as well as internal cuts.

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Anglo American chief executive Mark Cutifani said: "Together with the additional material capital, cost saving and productivity measures announced today, we are setting out an accelerated and more aggressive strategic restructuring of the portfolio to focus it around our ‘Priority 1’ assets, being those assets that are best placed to deliver free cash-flow through the cycle and that constitute the core long-term value proposition of Anglo American.

"As we redefine our operational footprint, we are aligning our organisation to ensure optimal efficiency and effectiveness."

"As we redefine our operational footprint, we are aligning our organisation to ensure optimal efficiency and effectiveness.

"As a next step and as we determine the future portfolio, we will be consolidating our six business unit structures into three, De Beers, Industrial Metals and Bulk Commodities, providing further opportunity to reduce the cost burden on our business."

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The company has also targeted $3.7bn of cost and productivity improvements from 2013 to 2017, while capex will be reduced by a further $1bn by the end of 2016.

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For 2017, the company is reducing capex to $2.5bn, which represents a 55% reduction versus its 2014 expenditure.

Anglo American also expects impairment charges of $3.7bn-$4.7bn, largely due to weaker prices and asset closures.

By the end of 2017, the company expects to achieve $3.7bn in efficiency improvements.

The company will also progress the sale process for the phosphates and niobium businesses during 2016.