Higher Yen Rate to Reduce Profit for Japan Nonferrous Metal Industry

Surging yen rate could suffer profitability for Japanese nonferrous metal industry. The foreign exchange rate of yen is around 100 yen per US dollar while Japanese major companies expected to be around 110 yen. The higher yen rate reduces the return from offshore sales and investment while the import materials cost decreases. Sumitomo Metal Mining expects the 1 yen per US dollar change could impact around 1 billion yen for profit for Japanese copper and nickel smelting operation due to lower selling price linked with international market. Mitsubishi Materials expects the impact is 200 million yen for operating profit with every 1 yen per US dollar change while Mitsui Mining & Smelting expects 100 million yen impact for operating profit. Many Japanese light metal rerollers could enjoy the benefit from higher yen rate. Furukawa-Sky Aluminum could be suffered from higher yen rate for export revenue of aluminium forgings. Japanese major electric wire makers could be suffered from the higher yen rate. The impact is expected to be around 600 million yen for Furukawa Electric, around 200 million yen for Hitachi Cable and around several hundreds million yen for Fujikura at every 1 yen per US dollar change.