Glencore Australia Holdings announced its inaugural five-year benchmark issue with initial pricing guidance of about 140 basis points over the five-year swap rate, or about 4.85 per cent.

The notes are expected to be rated Baa2 by Moody's and BBB by Standard & Poor's.

While the company did not put a number on the amount of capital it hopes to raise, five-year benchmark issues typically raise in the vicinity of $500 million.

The joint lead managers on the deal are ANZ Banking Group, National Australia Bank, and UBS Investment Bank Switzerland.

"This deal is big news for the local debt capital market," National Australia Bank head of corporate bond origination Brad Scott said.

"It is always exciting to see a big international make a debut offer, but it is particularly encouraging at the moment. Amid subdued credit growth, 2014 has so far been a much quieter year for new corporate issues than 2013," Mr Scott said.

The local deal, which investors say has been in the works for about a year, comes after Glencore launched a seven-year €600 million ($846 million) bond in the European market overnight.

Glencore is a $US48.5 billion ($52.9 billion) company that listed with $US38 billion of long-term debt obligations.

The company has several major assets in Australia, is the nation's largest coal producer, and is reportedly a front-runner to acquire BHP Billiton's Nickel West assets.

Local bond investors welcomed a new corporate issuer amid a dearth of Australian dollar corporate bond deals.

"It provides the opportunity for further diversification away from banks and financials who have dominated recent issuance," Perpetual deputy head of fixed income Vivek Prabhu said.

The 140-basis-point margin compared with about a 163-basis-point equivalent margin on the new longer-term European bonds, although the spreads contracted in secondary markets.

The Glencore transaction follows a number of high-profile commodities bond issues in the local market. BHP Billiton sold $1 billion of five-year bonds in October 2012, a landmark raising that was credited with opening up the Aussie bond market.

Last year, Anglo American issued $500 million of five-year bonds, while international oil giant BP has twice issued bonds in the market.

Glencore's bond issue will take total issuance in the Aussie bond market above $5 billion for the year, which is tracking slightly behind the $6 billion issued at this stage last year, according to Thomson Reuters data.

But bankers said a solid pipeline of issuance was building and they expected total issuance by year's end to reach about $10 billion, in line with the 2013 total.