Indonesian Refineries Shutdown Could Impact Asian Tin Refineries

Indonesian government forced domestic 4 tin refineries into shutdown at the end of September, which had continued operation without governmental authorization. Non-authorized refineries in Indonesia are said to produce almost half of Indonesian tin or 60,000 tonnes per year, which accounts for about 20% against 330,000-340,000 tonnes of world yearly tin production. Indonesian tin ore and crude tin ingot are exported and refined in Thailand, Malaysia and China, while China is the secondly largest tin producer in the world. These importers might be seriously impacted by severe operation control against the non-authorized tin smelters by Indonesian government.A newly established tin refining joint venture, Singapore Tin Industries seems impacted mostly by Indonesian refineries’ shutdown. The JV was established in February 2006 between KJP International of Indonesia and Yunnan Tin of China with 36,000 tonnes of annual output capacity. The equipment could not work fully with less supply of crude tin from Indonesia, though which is so large to meet one-tenth of world production.On the other hand, 2 major brands from Indonesian government running PT Timah and PT Koba may regain momentum, while the brands reduced the share in the market. In 2006 Indonesian new players and offshore producers actively tried to expand output due to the surge of international tin price and the ore supply became shorter. PT Timah and PT Koba could secure less ore under the competition with new brands with cheaper price and higher quality.