September 07, 2013
Indonesia’s top tin exporter PT Timah said it has stopped tin shipments and declared force majeure since new regulations forcing domestic producers to trade on a local exchange came into force last Friday. Indonesia is the world’s biggest exporter of tin and the shortfall is already feeding into global prices, with cash tin on the London Metal Exchange soaring to the highest premium against the benchmark contract in more than ten months on Tuesday.
Responding to a question asking whether the company had declared force majeure, Timah corporate secretary Agung Nugroho said in a text message: “Yes, we have since the Inatin is implemented, 30th August”. Indonesia’s total refined tin exports rose almost 3 percent in 2012 to 98,817 tonnes, with top tin miner PT Timah contributing about 30 percent.
The Indonesia Commodity and Derivatives Exchange (ICDX) launched the country’s only physical tin contract, known as Inatin, last year. As of last Friday, all 47 registered tin ingot exporters must trade on a domestic exchange before shipping material. But Nugroho said the company was forced to declare force majeure because its customers had not registered with the exchange.
“There is only one at the moment, Inatin, and that’s not working. They are fixing some of the latest issues but far less material will come out of Indonesia. And that certainly is going to have a big effect on the tin market.” Three month tin prices on the London Metal Exchange rose 1.6 percent on Tuesday, and were last trading down 0.2 percent at $21.524 a tonne. An ICDX spokesman said the company’s CEO was unable to give an immediate comment. Courtesy Reuters
Published in ZaraiMedia.com