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Indonesian tin rules cause confusion

Keywords: Tags  tin, indonesia, ITRI, Petter Kettle, LME, tin price, tin premium

NEW YORK — Tin consumers and traders serving the U.S. market have expressed confusion over revisions to Indonesia’s recently introduced tin export rules, with most adopting a wait-and-see approach as to what these rules might mean for domestic prices and premiums.

Earlier this month, Indonesia’s trade ministry announced plans to relax impurity limits for tin exports—a move that came just one week after the country imposed the new regulations in the first place (, July 9).

The new regulations and subsequent changes have caused "utter confusion" on what this means for trade and business, one U.S.-based tin alloyer told AMM.

Initially, refined tin ingots exported from Indonesia had to contain a minimum of 99.9 percent tin with only 100 ppm (parts per million) lead. On June 28 however, Indonesia’s trade minister Gita Wirjawan signed off on a revision that increased the maximum limit for lead to 300 ppm.

It is still unclear how the new regulations will impact the U.S. market, especially since the market has yet to see how the new lead limits will be enforced, the alloyer said.

Peter Kettle, market analyst at Hertfordshire, England-based International Tin Research Institute (ITRI), agreed that enforcing the new rules will be difficult. "I don’t know if anyone’s really thought it through. No one I know can tell me how it’s going to work," he told AMM.

Consumers in the U.S. market say they have doubts whether the new export rules or subsequent revision will have an impact on tin prices or tin premiums domestically.

"The market certainly hasn’t cared yet," one foundry source said. "The price has actually dropped a bit" since the original regulation went into effect July 1, he said.

Cash tin traded at $19,305 per tonne on the London Metal Exchange July 15, down from $19,755 per tonne July 1, despite a brief rise to more than $20,000 per tonne between July 2 and July 4.

The rationale behind the regulations, which also stipulate that qualifying tin ingots may only be shipped by registered exporters approved by the trade ministry, was to find a way to fetch a higher price and/or premium for Indonesian tin, Kettle said.

AMM’s delivered U.S. tin premiums are in a range of $550 to $700 per tonne, up slightly from $550 to $650 per tonne in June (, June 5). but still less than premiums of between $600 to $750 per tonne reported in April.

Indonesian tin accounts for about half of global tin supply, but it is not as important for the U.S. market, Kettle said. Many U.S. tin imports come from South American markets, he added.

More than half of U.S. unwrought, not alloyed, tin imports in the January through May period came from Bolivia, Brazil and Peru, data from the U.S. Department of Commerce and the U.S. International Trade Commission show. However, the volume of tin coming into the United States from Indonesia is increasing.

The United States imported 16,707 tonnes tin from January to May, the data show, 56.9 percent of which came from South America and 18.1 percent of which hailed from Indonesia. Last year, the United States imported 16,054 tonnes of tin during the same period, 62.5 percent of which was from South America and 12.6 percent of which was from Indonesia.

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