LG Chem Ltd, South Korea's biggest chemical manufacturer, reported a 40 percent fall in second-quarter profits, amid rising feedstock costs and weakening demand from China, its biggest market.

Net income fell to 373.9 billion won ($327 million) in the three months to June 30 from 624.5 billion won a year earlier, the Seoul-based company said on Wednesday in a regulatory filing.

The quarterly result, the smallest since it adopted international accounting rules in 2011, fell short of the 382.8 billion won average of 20 analyst estimates compiled by Bloomberg.