China Tin suffers from severe ore shortages

Liuzhou China Tin Group Co, the country's second largest tin producer, is suffering from a severe shortfall in raw materials due to insufficient supply of power at its mine, industry sources said on Monday.
The shortfall, if continued, may cut the company's tin production to around 5,000 tonnes this year, one-third of the output expected by the company late last year. It was expected to produce 12,000-13,000 tonnes of tin in 2003.
"We produced 400 tonnes of tin in May. I cannot tell you how much we can produce this month," an official for Liuzhou China Tin told Reuters late on Friday.
Liuzhou China Tin is owned by the government of China's south-western Guangxi autonomous region, home of the tin producer.
Industry sources said operations at Gaofeng Mine, which is the most important mine to Liuzhou China Tin, had halved for much of the past five months due to power shortages.
"The Gaofeng Mine only operates 15 days out of every month," said an industry official in Nandan in Guangxi.
Sources said the power supply in Nandan had not increased although the supply in other areas in Guangxi had improved this month following increased rains.
China's fast-growing economy grew 9.8 percent in the year through the first quarter after rising 9.1 percent last year, leading a shortfall in electricity.
Guangxi, which relies on hydro-electric power, has been hard hit by China's power shortages as it experienced a drought last year.
Except the Gaofeng Mine, operations at most mines in Nandan have been halted since July 2001 due to fatal accidents that led the government to restructure local mining activities. China's state-owned Aluminium Corp of China (Chinalco) and China Minmetals Non-ferrous Metals Co both were in talks with the Guangxi government for a possible acquisition of the tin producer, a company source said late on Friday.
Minmetals Nonferrous had asked the Guangxi government to centralise mines in Nandan and give the sole mining right to Liuzhou China Tin if the trading company took over the tin producer, sources said.