Higher Ore Cost Suffers Japan Nonferrous Metal Smelters in 1Q

Japanese nonferrous smelters were suffered from higher ore cost in April-June while Nippon Mining Holdings and Mitsubishi Materials posted higher net profit than same period of 2007 and Furukawa revised the full year outlook upward for the year ending March 2009. Sumitomo Metal Mining, Dowa Holdings and Toho Zinc posted lower recurring profit for the first quarter due to lower international metal prices. Mitsui Mining & Smelting revised the half year outlook downward despite of higher recurring profit for the first quarter. Nippon Mining Holdings reported 2.2 times gain from oil inventory valuation in April-June from same period of 2007, which increased the recurring profit by 15%. However, the metal unit, Nippon Mining & Metals posted 18% lower recurring profit due to higher ore cost and higher yen rate. Mitsubishi Materials posted 1% lower recurring profit for copper unit in April-June from same period of 2007. The electrolytic copper output increased by 8,000 tonnes, which covered higher ore cost. Furukawa revised the full year outlook upward due to high level copper price. Sumitomo Metal Mining posted 30% lower recurring profit for April-June from same period of 2007. The metal and metal processing units posted lower sales and profit due to lower nickel price and stainless sales while the resource unit posted higher sales and profit due to contribution from mines with the interests in South America under higher copper price and output.