News

13 January 2014

Tin: in 2014 prices are threatening to grow

In late 2013, Morgan Stanley predicted the most popular market for tin among other non-ferrous metals. The growth in demand is based on the restoration in the field of electronics, and the stocks of tin in the warehouses of the London Metal Exchange will significantly decrease. Much of the reason for this situation can be considered China, which turned into an importer of this product, and the reduction in supplies from Indonesia had a significant impact.

Despite the fact that compared to the copper market, which is about 20 million tons, the demand for tin is quite small - only 300 thousand tons - it is in a more vulnerable position, since the offers are rather limited. And the export problems from the Congo and Indonesia can not but affect the tin market. Nevertheless, analysts of Iruniverse, in contrast to Morgan Stanley, are sure that there is no shortage in the offer, as tin is produced not only in Indonesia and Congo, but also in Bolivia, Laos and Myanmar.

According to PT Timah, Indonesia, tin prices will increase by 50 percent in 2014, which will be 25-30 thousand USD, respectively. At the London Metal Exchange quotations have already increased by 22%, which by the end of November was 23 thousand per ton.

This situation should stabilize the financial situation of PT Timah, since in this case the revenue for raw materials in 2014 is expected to be 9 trillion Indonesian rupees, equivalent to 761.6 million USD. For comparison: at the end of 2013, revenues amounted to about 7 trillion rupees (about 590 million USD). In 2014, the company plans to spend 18 million USD for the development of a project for the extraction of raw materials in Myanmar.

The problems with the supply of tin remained in the past, although there was a certain danger before the end of the year in the shortage of proposals. In 2013, since the introduction of restrictions on exports and trade, supplies from Indonesia have declined significantly since August. By early autumn of 2013, their percentage was only 10 part of the usual level, and by the end of November it had not reached 50%. However, gradually the situation stabilizes, the number of deals increases, PT Timah, the largest tin producer, is again setting up exports, and other smaller enterprises - and there are at least 30 of them in the country - have re-started after registering on the stock exchange. Thus, by the middle of January 2014, tin supplies have fully stabilized.

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