Indonesia’s PT Timah reported a strong revival in its production volumes in the September quarter, while profitability was also considerably improved compared to the first half of the year.
The state-controlled tin company reported tin-in-concentrate production in the quarter of 15,466 tonnes, the highest quarterly total for over two years and greater than in the first half of this year. Cumulative mine output (including purchased ore) stands at 27,160 tonnes in the first nine months, down 30% compared to last year as a result of the poor first half performance. Production this year has been split almost evenly between inland and offshore production.
Refined tin production also bounced back in Q3, amounting to 14,387 tonnes. Year-to-date output was 33,765 tonnes, down 11% compared to the same period of last year. However Timah’s sales of refined tin rose by 7% to 36,453 tonnes as stocks have been run down. Commenting on prospects into 2010, Timah President Director Wachid Usman told Dow Jones that he expects the sales volume to increase to 50,000 tonnes next year, from the 45,000 tonnes the company has targeted this year. "I expect tin prices to improve next year with better demand due to economic recovery in the US and European countries," Usman told reporters. America and Europe accounted for 7% and 25% respectively of the company’s sales so far this year.
Timah’s third quarter net profit fell by 66% year-on-year to Rp 128.1 billion (US$13.0 million), but was also much improved on its first half results. Year-to-date net profit was Rp 171.0 billion (US$16.2 million). Margin per tonne in the latest quarter recovered to US$2,234, up from $645/tonne in the first half. The improvements reflect higher tin prices and reduced competition from independent smelters since late August.
