March 23, 2011 / 3:23 AM / in 7 years

UPDATE 3-Teck cuts coal, copper sales view on labor strike

* Sees minimal impact to copper, coal shipments to Japan

* Sees FY coal output 23.5-24.5 mln tonnes

* Raises FY mining cost to C$63-C$67 per tonne

* Sees Q1 mining cost of C$77-C$80 per tonne

* Shares down 2 percent (Updates share movement in paragraph 2)

March 23 (Reuters) - Teck Resources cut its full-year sales outlook for coal and copper, as it grapples with ongoing labor issues at its Elkview coal mine in southeastern British Columbia.

Shares of the Vancouver, British Columbia-based company were trading down 2 percent at C$51.01 Wednesday on the Toronto Stock Exchange. They have lost 10 percent in the last 3 months.

The sales warning comes days after the company trimmed its first-quarter coal sales forecast, citing rail traffic disruptions and adverse weather.

Workers at the Elkview mine, with an annual production capacity of 5.6 million tonnes, had started a strike over a new labour contract in end-January. More than 700 workers at the facility have worked without a contract since the end of October.

Earlier this week, workers in the mine rejected a new 5-year collective agreement that the union forged with the company, prolonging the strike that has hit production at the site.

The company, one of the world’s top exporters of metallurgical coal, also said it expects “minimal impact” to shipments of copper, coal and zinc to earthquake and tsunami hit-Japan.

Teck now expects coal sales in 2011 to be 23.5-24.5 million tonnes, compared with its prior view of 24.5-25.5 million tonnes.

It also raised its 2011 mining cost to C$63-C$67 for every tonne of product sold, from its earlier view of C$59-C$63 a tonne.

For the first quarter the company expects the mining cost to be C$77-C$80 per tonne.

The Vancouver-based company also cut its copper sales forecast to 330,000-340,000 tonnes from the 350,000 tonnes it saw earlier.

In the first quarter, the company is expected to meet 23 percent of the lower end of its full year copper production. It expects first quarter copper production of 75,000 tonnes.

Teck’s New York-listed shares were also trading down 2 percent down at $51.94. (Reporting by Aftab Ahmed & Arup Roychoudhury; Editing by Saumyadeb Chakrabarty)

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