(Updates with closing share price in fourth paragraph.)
Oct. 26 (Bloomberg) -- Nyrstar NV, the world’s largest producer of refined zinc, cut its forecast for output from mines because of lower-than-expected deliveries from Talvivaara Mining Co.’s Finnish site, where it has an offtake agreement.
Full-year zinc production from mines will be as little as 205,000 metric tons, the company, based in Balen, Belgium, said today in a statement. That compares with an earlier forecast of 215,000 tons that didn’t include four months of output from the Breakwater Resources Ltd. mines Nyrstar agreed to buy in June.
Nyrstar expects mine output of at least 73,500 tons in the final three months, up 42 percent from the preceding period, as the Breakwater mines contribute to a full quarter, and plans to raise its annual production rate to 475,000 tons by the end of next year. It’s also relying on the Breakwater acquisition to lower the average cost of production to less than $1,000 a ton from $1,515 in the first half and counter a drop in prices.
Nyrstar fell 8.5 percent to 6.141 euros by the close in Brussels, the biggest drop since Aug. 18. Zinc for three month delivery rose 1.3 percent to $1,865 a ton in London.
Production of refined zinc from Nyrstar’s smelters rose 2.5 percent to 805,000 tons in the nine months through September and full-year output will surpass last year’s record of almost 1.08 million tons, Chief Operating Officer Greg McMillan said.
Third-quarter output fell 12 percent because of the planned replacement of the “roaster dome” in Clarksville, Tennessee, and unexpected “operational issues” at its main casting plant in Overpelt, Belgium, Nyrstar said. Lead production has climbed 19 percent to 162,000 tons so far this year, with silver output surging 36 percent to 13.4 million troy ounces.
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