Melbourne (Platts)--3Dec2012/456 am EST/956 GMT

Sydney-headquartered International Ferro Metals has cut its forecast for ferrochrome production in the October-December quarter of fiscal 2012-13 because of problems with two of its furnaces in South Africa.

It expects to produce 15% less ferrochrome in the quarter compared with 58,000 mt in the previous quarter, the company said Friday.

Electrode breaks at the furnaces have significantly reduced efficiency and output, IFL said, adding that it has sourced an alternative supply of high quality electrode paste. IFL said it expects repairs to be complete by the end of the month.

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As a result of the production problems and falling ferrochrome prices, IFL said it expects its earnings in the quarter ending December 31 to be negatively impacted.

Despite the setback, "the company is encouraged by recent signs of stronger demand and prices from China," IFL CEO Chris Jordaan said.

IFL is currently in discussions with South African power firm Eskom regarding its new electricity buy-back program, it said.

--Marnie Hobson, marnie_hobson@platts.com --Edited by E Shailaja Nair, shailaja_nair@platts.com

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