UPDATE 1-Chilean paper producer CMPC reports lower net profit
SANTIAGO Aug 26 (Reuters) - Chilean paper company CMPC on Monday reported its second-quarter net profit tumbled 16 percent, sharply missing market expectations, as rising costs in the forestry business outweighed higher export sales of short-fiber cellulose, used to make writing paper and tissue.
CMPC reported a net profit for the period of $30.6 million, below the $55 million forecast in a Reuters poll.
Wood pulp is Chile's second biggest industry after copper mining, and it has grown rapidly in recent years as companies have snapped up producers elsewhere in Latin America to feed a surging demand from China for paper.
Also on Monday, CMPC's Chilean rival Arauco, which is part of the Empresas Copec empire and one of the world's biggest wood pulp producers, reported a rise in second-quarter profit to $150 million.
Arauco is hoping to chop down its high debt pile by focusing on advancing a string of recent acquisitions, including a giant complex in Uruguay and plant in Brazil, to profitability.
"Probably this year and next we will endeavor to obtain income from those investments and reduce our leverage to normal levels and prepare the company for a second stage of growth," Arauco's chief financial officer, Gianfranco Truffello, said on a call with analysts on Monday.
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