Following discussions with tin industry body ITRI, Indonesia’s Minister of Energy and Resources, Professor Purnomo Yusgiantoro, has made it clear that Indonesia will make every effort to maintain tin supplies to the global market. Indonesian production has been sharply reduced since last October by official efforts to regulate small-scale mining and independent smelter operations. ITRI estimates that its refined tin production this year will amount to 90,000 tonnes, down from over 125,000 tonnes in 2006, although some other forecasts of 2007 output are significantly lower.
The Minister assured ITRI’s Chief Executive, David Bishop, that steps would be taken to ensure that output would be maintained at a rate of some 90,000 tonnes per year. The steps that will be taken to maintain supply include increased production by P.T.Timah, expedited issue of licenses to properly qualified independent smelters, and an examination of various options to make full use of PT Koba Tin’s smelting capacity.
The Indonesian Government and ITRI were in agreement over the need to achieve a more stable tin price. There has been speculation that a large production deficit this year will see prices spiralling. However the Minister stated that he would strive to ensure a minimum level of supply from Indonesia in order to prevent such instability, which would damage consumer confidence in the metal.
David Bishop said ”We fully support the strategy of the Indonesian government which is intended to address the social, legal and environmental concerns over small scale tin production on Bangka and Belitung islands. ITRI was concerned that further rapid increases in tin price caused by a significant shortfall in supply might threaten the continuing strong growth in consumption and could lead to an irreversible loss of tin use in some market sectors. We believe producers and consumers alike will therefore very much welcome the commitment to ensure a minimum level of supply.”
