Malaysian tin surged three percent on Wednesday to hit a 15-1/2-month high, following a sharp rise in the metal's London price, as investors' hunger for commodities continued unabated, dealers said.
Spot tin on the Kuala Lumpur Tin Market (KLTM) ended up $255 at $8,685 a tonne, its highest level since reaching $8,785 on December 22, 2004.
Three-month tin on the London Metal Exchange (LME), which often lends direction to the KLTM, closed Tuesday up $330 at $8,760 per tonne. Buyers from Europe and Japan sought a total of 202 tonnes at the market's open, while sellers offered 45 tonnes.
Final volume was 50 tonnes, up from Monday's 15 tonnes. Japanese buyers took 27 tonnes, Europeans 20 tonnes and Malaysians three tonnes. "Sellers were still reluctant to sell as they expect the market to go up further," a dealer said. "When the price increased, buyers withdrew."
The premium for shipping a tonne of Malaysian tin to Europe - calculated on a cost, insurance and freight basis - fell to $130 on Wednesday, taking into account the difference between the price rises in London and Kuala Lumpur, dealers said.
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