Low nickel prices continue to take their toll on Inco (TSE), which reported losses of US$2.2 million (3 cents per share) for the second quarter and US$24.8 million (25 cents per share) for the six months ended June 30.
Last year, the company lost US$1.5 million in the second quarter and US$700,000 for the half year.
Despite some production cutbacks, the nickel price is trending downward as metal inventories rise amid poor demand. During the second quarter, nickel averaged US$2.93 per lb. compared with US$3.48 for the same period in 1992. It is currently trading at about US$2.20.
Analysts say base metal producers such as Inco face a bleak second half unless metal prices do an about-face, which they consider unlikely. Inco’s losses would have been greater but for an 11% decline in production costs during the first half. The company says reduced employment helped to lower costs.
Be the first to comment on "In the trough — Inco hammered by nickel price"