(Adds profit outlook, director comment, details)
TOKYO, Nov 10 (Reuters) - Sumitomo Metal Mining, Japan’s second-biggest copper producer, cut its full-year profit forecast on Tuesday, blaming plunging prices of copper and nickel and the delayed ramp-up at the Sierra Gorda copper mine in Chile.
Like its peers, the Tokyo-based smelter and miner is battling a slide in commodity prices as a result of slowing growth in China, the world’s top consumer of industrial metals.
“Nickel and copper prices have fallen deeper than we had anticipated due to slowing demand in China,” Masahiro Morimoto, director at Sumitomo Metal, told a news conference.
“We expect nickel prices to rebound earlier than copper prices given the demand-supply balance, but we can’t tell when that will happen,” he said.
Sumitomo Metal now expects group recurring profit, which is pretax before one-off items, of 85 billion yen ($689 million) for the year through March 2016, compared with 148 billion yen estimated six months earlier.
The revised forecast missed the Thomson Reuters I/B/E/S mean estimate of 127 billion yen.
Sumitomo Metal, also Japan’s biggest nickel smelter, slashed its outlook for nickel prices for the October-March period to $4.5 per pound from its May forecast of $6.5 per pound, and its estimate of copper prices to $5,200 per tonne from $6,000.
It also trimmed full-year copper output guidance at the Sierra Gorda mine in Chile to 100,000 tonnes from 123,000 after the delayed start of commercial production at the end of June, against its earlier plan of April.
The Sierra Gorda mine, which it owns jointly with Polish producer KGHM Polska Miedz, aims to reach full capacity utilisation in December, but the timing may be delayed until the first quarter of 2016 due to a technical problem that has been found recently, Morimoto said. ($1 = 123.3100 yen) (Reporting by Yuka Obayashi; Editing by Tom Hogue and Gopakumar Warrier)