* Mining group’s Q3 sales fall 3 pct to 792 mln euros
* Manganese output hits record as steel demand grows
* Shares rise in market rally on EU summit deal
PARIS, OCT 27 - French mining group Eramet forecast a lower current operating profit this year due to falling nickel and manganese prices in the second half.
Lower prices coupled with exchange rate effects led to a 3.3 percent fall in the third-quarter sales to 792 million euros.
But Eramet raised production of nickel and manganese in the third quarter versus the same period last year, as global steel demand continued to rise, with the company seeing record quarterly output in manganese.
“The Eramet group confirms that the nickel and manganese prices observed since the start of the second half of 2011 have remained below first-half 2011 levels,” it said in a statement.
This year’s current operating income would be lower than 2010’s level of 739 million euros, it said.
Eramet shares were up 3.8 percent by 0825 GMT, supported by broad market gains after European leaders struck a deal to tackle a debt crisis in the euro zone.
“Their numbers are not bad enough to justify a fall of more than 50 percent in the shares since May,” said Franklin Pichard of Barclays Bourse France.
“The market is playing a rebound on certain cyclical shares with an improvement in the environment and the creation of a European governance that could be announced at the G20,” he said, referring to a meeting of major world economies next week.
Eramet’s manganese sales fell 9 percent in the third quarter to 398 million euros, but its production of ore and sinter rose 8.6 percent to a record 957,000 tonnes.
Nickel sales fell 4 percent in the third quarter to 200 million euros, while the group’s metallurgical nickel output at its Doniambo site in New Caledonia rose 6 percent.
The group’s alloys division saw third-quarter sales rise 11 percent to 196 million euros on continuing aerospace orders.
Some analysts have been predicting a slowdown in the steel sector — the main outlet for nickel and manganese ore — due to signs of easing growth in China and economic uncertainty in Europe, where several steelmakers have idled furnaces.
World steel production has continued to show growth in the third quarter while global mining giants Rio Tinto , BHP Billiton and Vale have reported continued strong demand for their iron ore.
Eramet said it remained bullish about its longer-term prospects because of emerging-market growth led by China, and was pursuing plans to raise its manganese ore output to 4 million tonnes annually by the end of 2012.