A police crackdown on illegal tin mining in Indonesia, including in Bangka-Belitung islands, has cut ore supplies. Analysts maintain the current crack down may not be as severe as the one in 2006, which halted tin production at small smelters for months, mainly because the government has tightened tin export rules. Moreover, PT Timah Tbk and PT Koba Tin, a unit of Malaysian Smelting Corp, were not affected by the crackdown.
Indonesia’s ability to stop supply as and when prices weaken should see tin remain above $10,000/t, 30%-40% above historical levels.
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Malaysian tin jumped 9.5 percent on Tuesday, boosted by surging LME prices and a squeeze in supplies.
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The company expects to produce below 50,000 tonnes of refined tin next year due to falling prices and a government plan to set an output quota for tin.
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Malaysian tin jumped 9.5 percent on Tuesday, boosted by surging LME prices and a squeeze in supplies.
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Tin prices are expected to trade higher as supply-side issues from Indonesia are expected to support prices of the commodity.
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Wednesday, September 16, 2009