Malaysian tin was steady at $6,650 a tonne on Tuesday, with dealers unsure how long it would hold amid a record premium against tin on the London Metal Exchange (LME).
Spot tin on the Kuala Lumpur Tin Market (KLTM) was quoted at $6,650 a tonne after a trade of 43 tonnes - one tonne shy of Monday's volume.
Tin on the LME was only at $6,540 a tonne at Monday's close - $110 lower than the price on the KLTM.
But the cost of shipping a tonne of Malaysian tin to Europe - including brooking fees - stood at a staggering $305, compared to past weeks levels of $200-$250 a tonne, dealers said.
"We are overpriced against London," said a KLTM trader. "Either we have to give or they have to come up to our level."
A global drop in tin stocks had led to a surge in recent months in KLTM and LME prices. The London market is currently at 7-1/2 year highs while the Malaysian price is hovering at six-year highs.
LME's tin stocks stood at 14,430 tonnes on Monday, down from a record high of 39,475 tonnes in August 2002.
Dealers have said demand for tin was likely to exceed supply by 16,000 tonnes in 2004.
In Tuesday's trade on the KLTM, buyers and sellers matched positions at the first strike as each side committed 43 tonnes.
Europeans dominated trading as the euro remained strong against the US dollar. Japanese interests were also active.
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