Nov. 2 (Bloomberg) -- Twenty-four tin producers in Indonesia, the largest exporter, are likely to agree to extend a shipment ban until yearend to boost prices, said Johan Murod, director at PT Bangka Belitung Timah Sejahtera, a smelter group.
The companies are actively trading and producing tin this year out of the 32 registered exporters at the Trade Ministry, he said in an interview in Jakarta before flying to Bangka to attend a meeting where the plan will be discussed. Fifteen producers agreed to prolong the halt at a gathering on Oct. 28.
Tin plunged 17 percent in September on concern that Europe’s debt crisis may derail the global economy, prompting Indonesian companies to suspend exports from Oct. 1 to try to drive prices to $25,000 per metric ton. The country represents more than 40 percent of global exports, according to Peter Kettle, research manager at St. Albans, England-based ITRI Ltd.
While three-month tin gained 8.1 percent last month as the ban took effect, the contract underperformed the 10 percent advance in the LMEX Index of six base metals. Tin, which last exceeded $25,000 per ton in August, traded at $21,750 today.
A longer ban may cut inventories monitored by the LME to about 10,000 tons by the year-end, Kettle said on Oct. 29. Stockpiles of the metal used to make solder have slumped 26 percent since Sept. 30 to 15,895 tons, the lowest level since December, according to Bloomberg data.
Indonesia exported 73,223 tons of refined tin in the first nine months of the year, 9.3 percent more than a year ago, the trade ministry said on Oct. 10. The country shipped 92,487 tons last year and 99,287 tons in 2009, ministry data showed.
Tin also dropped this year as a manufacturing slowdown in China and the U.S. threatened to cut demand. PT Timah President Director Wachid Usman said on Sept. 27 that the decline had been driven by poorer market sentiment caused by the European crisis, rather than supply-demand fundamentals.
As Indonesia is entering the wet season, which can reduce mining, an extended ban “won’t be a big problem for smelters,” Rudy Irawan, deputy chairman of the Indonesian Tin Industry Association, said last month. Irawan is also the president director of Jakarta-based smelter PT Mitra Stania Prima.
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