Malaysian tin price fell to a three-month low on Wednesday despite gains on the London Metal Exchange (LME), as a summer lull curbed foreign demand. The spot price on the Kuala Lumpur Tin Market ended down $15 at $8,900 a tonne, the lowest since April 29 when it closed at $8,870.
"Buying interest from Japan and Europe has slowed significantly due to the summer holidays. That's why we are down despite higher LME," said one trader.
Japanese buyers, who were behind the sharp run-up in tin prices this year, seemed to have met their immediate buying requirements.
The Japanese use tin extensively for soldering purposes in their electronics industries. "They are likely to return in a big way only after the middle of August," the trader added. Tin on the LME, which often sets the trend for the KLTM, closed $70 up at $8,820 a tonne on Tuesday.
On the KLTM, traders noted initial bids from Malaysian and Japanese interests for 45 tonnes, against offers at 72 tonnes. Final volume was 62 tonnes, up from Tuesday's 50 tonnes.
The price drop on the KLTM versus the rise on the LME narrowed the premium for shipping a tonne of Malaysian tin to Europe, including freight and other costs, to $305 from $390 previously, dealers said.