PERTH (miningweekly.com) – Mineral sands miner Iluka has nearly halved its combined zircon, rutile and synthetic rutile production during the first half of the 2013 financial year, as it curtailed output in response to weaker demand.

During the first six months of the year, combined zircon, rutile and synthetic rutile production reached 238 100 t, which was 46.3% below the 443 800 t produced in the previous corresponding period, the miner reported on Wednesday.

The company noted that the lower production reflected the completion of its operating adjustments to curtail output and to facilitate a progressive draw-down of inventory, as well as to reduce total operating costs.

Combined zircon, rutile and synthetic rutile production for the three months to June was also down 43.9% on the June 2012 quarter, to 127 200 t. However, this was 14.7% higher than the previous quarter’s production figures.

Iluka reported that first-half zircon sales volumes reached 210 900 t, which was a significant increase on the 87 400 t sold during the previous corresponding period and nearly equal to the 2012 full-year sales volumes.

The first-half zircon demand recovered in most markets and trended in excess of production, the company said, allowing a draw-down in inventory.

Meanwhile, first-half rutile and synthetic rutile sales volumes of 76 300 t were at levels similar to those experienced in the second half of 2012, and significantly lower than the first half of 2012.

Revenue for the three months to June reached A$241.8-million, while first-half revenue tipped at A$381.7-million. Iluka added that the lower first-half revenue, compared with the same period in 2012, despite the higher sales volumes, reflected the lower received prices period-on-period.

The company predicted that zircon sales volumes for the full year would exceed production, which has been increased to some 280 000 t, with the difference being met by inventory.

However, Illuka warned that forecasting demand remained challenging, owing to factors such as the volatility of global and regional economic performance and associated business confidence levels.

Rutile and synthetic rutile sales for the full year were expected to be in line with expected production of around 200 000 t.