JAKARTA: A quarter of Indonesia's tin smelters back a plan to suspend exports and prop up global prices, the chief of an industry body said on Friday, ahead of a vote on the issue targeted next week.
Indonesia is the world's top exporter of tin, and the governor of its main producing region of Bangka-Belitung is spearheading an attempt to support London prices of the metal that are trading near 2-1/2 year lows.
"As of now, it is fifty-fifty," said Jabin Sufianto, president of the Indonesian Association of Tin Exporters (AETI), which groups 19 tin smelters with an annual capacity of around 30,000 tonnes.
Jabin told Reuters he expected to set a meeting next Tuesday for members to vote on the plan after discussing arguments for and against a moratorium.
"Of course we need PT Timah onboard," he added, referring to Indonesia's biggest tin miner, state-owned PT Timah.
An official of PT Timah this week told Reuters the firm would not back a moratorium, as the move was likely to be frustrated by the action of global market forces on the prices of all commodities.
Sufianto said tin smelters were seeking prices of between $19,500 and $20,000 a tonne, given a recent fall in crude oil prices. Tin hit lows of $17,445 per tonne on the London Metal Exchange (LME) this week, a level not seen since August 2012.
The recent slide resulted from slacker demand from top buyer China ahead of holidays for the Lunar New Year, which begins next week, with speculators and a global sell-off of commodities having weighed on prices, Sufianto added.
Indonesia has had little success over the years from several attempts to limit supplies and support prices, with many traders sceptical about the chances for the latest plan to halt exports.
Sufian to sees 2015 shipments from Indonesia's 38 active and fully licensed smelters at between 65,000 and 70,000 tonnes. This compares to trade ministry figures showing exports of 75,925 tonnes of refined tin last year.
But the forecast could fall further if tin miners miss an April deadline for "clean-and-clear" certification by provincial governments to ensure export registration.
In August 2013, Indonesia sought to boost prices, curb illegal mining, and win greater influence on global prices, by forcing all exporters of tin ingots to trade on the Indonesia Commodity and Derivatives Exchange.
Trade Minister Rahmat Gobel backs the 2013 domestic trading rules, and is positive about an AETI proposal for tighter rules and licensing for inter-island trading, Sufianto added.onesian tin smelters to vote on suspending exports next week
Comments
Comments are closed.