Malaysian Tin Bulletin-August '11

MALAYSIAN TIN BULLETIN
AUGUST 2011
August Tin Market Review

Kuala Lumpur Tin Market (KLTM)
The KLTM opened the trading month of August at US$28,100 per tonne, which was the months highest price level. The market, however, closed the trading month much lower at US$23,500 per tonne. The August average tin price was US$24,315 per tonne, lower as compared to the July average of US$27,297 per tonne. Tin was traded within a broad price range of US$22,500 to US$28,100 per tonne during the month. There were 21 days of trading on the KLTM in August. The August average daily turnover was 45 tonnes, slightly lower than the July average of 51 tonnes. The highest daily turnover recorded for the month was 65 tonnes, and the lowest was 20 tonnes. They were recorded on the 10th and 12th August, respectively. Trading on the KLTM during the first trading week of August was weak. The market drifted all the way down to record the months lowest at US$22,500 per tonne on 9th August. The market rebounded during the second trading week, and the uptrend lasted until the second day of the third week. According to a trader, the rebound was due to positive buying interest, limited supply and technical correction. The incline was also influenced by the increase in the tin price on the LME. For the remainder of the third trading week, the local market fell sharply following overnight leads on the LME.
Tin prices during the fourth trading week were generally strong except for some technical correction during the fourth day of the week. Prices rose further towards end of that week, which was attributed mainly to higher demand. The KLTM was closed for two days during the final trading week for Hari Raya Aidilfitri and the National Day.
AUGUST 2011
LME and New York Market

Tin trading on the LME opened the month of August at US$28,560 and US$28,650 per tonne for cash and 3month tin, respectively, which were their respective highest price level for the month. During the first trading week of August, tin prices decreased substantially to end the week at a much lower level than the opening. Prices then slid further as they moved into the second trading week, before zigzagging and ending the week on a higher note. The positive uptrend during the second trading week did not last long as in the third week tin prices tumbled all the way through to the first day of the fourth trading week to record the months lowest level of US$23,100 per tonne for cash tin and US$23,200 per tonne for 3month tin on 22nd of August. According to a trader, the decline was due to profit taking activities by investment funds, which took advantage of the earlier high prices. Thereafter, tin prices moved upwards until end of the month. The up-trend, however, was somewhat checked on 24th August when the market declined due to a technical correction. The August average LME cash and 3-month tin prices were US$24,419 per tonne and US$24,485 per tonne, respectively. Meanwhile, tin trading on the New York market in August again followed a similar trading pattern as on the LME. The average New York spot tin price for the month was US$25,103 per tonne. The highest and lowest prices recorded for the month of August in New York were US$29,255 and US$23,611 per tonne, respectively.
News Highlights
MSC Posts Higher Profit
Tin producer Malaysia Smelting Corp Bhd (MSC) posted a higher net profit of RM36.3mil in the second quarter ended June 30 compared with RM7.98mil a year earlier due to higher profit from its tin mining and smelting operations in Malaysia and Indonesia as well as higher tin prices. Revenue for the period rose to RM853mil versus RM623mil while earnings per share were 36 sen against 10.6 sen. The group had proposed an interim dividend of 12 sen per share less 25% tax per share payable on Sept 28. Meanwhile, at a media briefing yesterday, group chief executive Dato Seri Dr Mohd Ajib Anuar said the group was hoping to acquire new and existing mines projects in Malaysia and Indonesia. We are hoping to get the approvals and getting the licences for some of
AUGUST 2011
the mines this year and some next year, he said, adding that the mines were not that big in size and capable of producing 100 to 200 tonnes per month. As for the second-quarter results, Mohd Ajib said the group expected the overall performance to remain profitable in the second half of 2011 despite the current market volatility and uncertain short-term outlook. He also said MSC was optimistic about the long-term prospects of the tin industry and believed that the group would be able to capitalise on the strong global tin market fundamentals to expand its business.
(Source: The Star, 11 August 2011)
Indonesia to Impose Tin Export Royalty, Ban Ore Shipment

Indonesia, the worlds top refined tin exporter, will impose a new royalty charge on all tin shipments and only allow the export of refined tin, a trade ministry official said yesterday, a move that is expected to lend support to weakening global prices. South-East Asias largest economy, which supplies about 30% of the worlds tin consumption, expects to produce 90,000 tonnes of refined tin this year, up from 78,965 tonnes last year, on expectations of improved weather conditions. Every exporter will have to pay royalty before they can ship the metal, Deddy Saleh, director general of foreign trade at the trade ministry told reporters. We are preparing a new regulation on tin export as an amendment to the existing trade minister decree. It is almost final actually. Under the new rule, the government would not allow export of raw tin ore and concentrate and would only permit refined tin shipments, Deddy added. Only tin which (has) its royalty paid by exporters can be shipped for export, Deddy said. This is seen to be consistent with the governments policy to stop nonvalue added raw material exports within the next three years. Trade ministry officials were unavailable to give further details on how the royalty payment will be calculated and paid. At mid-session yesterday, benchmark tin on the London Metal Exchange (LME) was at US$24,050 a tonne, up from US$23,605 at the close on Thursday. Tin, used in electronics, plating and lead-free solders, struck a record high above US$33,000 in April. A crackdown on illegal mining, tighter export regulations, declining onshore reserves and rain that had hindered production in Indonesia have helped drive the tin rally earlier this year. We have seen Indonesian policy having a significant impact on tin in recent years, notably with the clampdown on illegal tin mining constraining tin ore/ concentrate shipments over the past year and a half, said David Wilson, analyst at Societe Generale in London. Further cutbacks in ore/concentrate exports can only be supportive for prices, as it would impact on refined production levels. (Source: The Star, 13 August 2011)
AUGUST 2011
No Change in Tin Royalty Rules

Indonesia has no plans to change rules on royalty payments of refined tin exports, Sri Nastiti Budianti, export director of mining and industry products at the Trade Ministry, told reporters yesterday. The country would charge royalties for domestic trade of tin and would check shipments for origin and destination to prevent illegal exports, she said. Indonesia has since February 2007 required tin exporters to pay a royalty before shipping the metal overseas, and allows only refined tin to be exported. (Source: The Star, 16 August 2011)
News Round - Up
Lower Japanese Tin Imports in June
Japans recent official trade data showed that the aftereffect of the recent earthquake and tsunami, which hit Japan last March, only began to impact the countrys refined tin imports much later in June. Just 1,932 tonnes of tin were imported that month after imports sustained quite well in April and May. This was a decrease of 43 per cent compared to June 2010 imports. The cumulative imports for the first half of 2011 decreased by 11 per cent to 15,141 tonnes from the high imports during the same period the previous year. From analysis of imports by a Japanese trading company, tin imports from Thailand during the May and June period, showed a decrease of almost 60 per cent compared to the same period last year. For the first half of 2011, Thailand recorded a market share of such imports of 34 per cent compared to Indonesia at 48 per cent and Malaysia of only 10 per cent. The rest were from China, Vietnam and Bolivia.
Indonesia's July Tin Exports Rose

Indonesia's Ministry of Trade revealed that the countrys exports of refined tin in July rose by almost 5 per cent to 9,266 tonnes from 8,870 tonnes exported during the same month last year. Total tin exported for the January to July period this year was 59,430 tonnes, an increase of 14 per cent from the same period in 2010. These figures came from checks made prior to shipment under the countrys export licence system. It is expected that the exports figure for the month of August will be much lower as demand from private smelters has been declining in response to the recent drop in LME tin prices. Meanwhile, a report released on 12th August stating that Indonesia was planning to either increase taxes or restrict exports on tin caused a sharp rise in LME tin prices. However, government officials later denied that no such changes were contemplated. The changes likely to be made were for domestic sales only. The ban on tin ore exports is already Indonesias longstanding policy. The tin ore exports ban was introduced in 2002 to dampen illegal mining, and to encourage the refining and value-added processing of tin locally. This policy has resulted in the establishment of over 30 private smelters, which process ores obtained from local small -scale miners. Indonesias Ministry of Trade is considering introducing a local royalty on trade between provinces within the country. This new royalty could affect small volumes of trade in metals and ores shipped from the Bangka Belitung province to Java and other parts of Indonesia. For the international market, Indonesia already collects a 3 per cent royalty on tin metal exports.
AUGUST 2011
Korea Building-up its Tin Stockpile

South Korea's Public Procurement Service (PPS) recently reported that it had purchased 300 tonnes of tin for delivery in early November from LG International Corporation. The tin purchased was on a cost, insurance and freight basis at a premium of $577 per tonne to the London Metal Exchange tin price. PPS is a state agency entrusted with the stockpiling of commodities. In recent years, it has stockpiled some 2,000 tonnes of tin to meet the needs of small and medium-sized manufacturers who are consumers of the metal. PPS was reported to be planning to increase its stockpiling of tin and other metals due to expected shortages in the supply of these commodities.
Chinas July Tin Output and Imports Decline

According to the China Nonferrous Metals Industry Association (CNIA), the countrys refined tin output declined by 8 per cent to 12,096 tonnes in July compared to the same month last year. Cumulative production for the January to July period, however, increased by almost 7 per cent from the same period in 2010. The Hunan and Guangxi provinces recorded the biggest increase. Chinas tin-in-concentrate output also increased by 17 per cent to 53,031 tonnes for the January to July period compared to the same period last year. Meanwhile, data from Chinas Custom Department showed that the countrys refined tin imports in July declined by 47 per cent to 721 tonnes from the same month in 2010 despite Chinas domestic tin price that month being higher than the LME. This was because local traders would have to pay 3 per cent import duty and 17 per cent VAT on such imports. Thus, it would not be profitable to import tin metal for general trade locally. In addition, the large swing in LME prices also posed huge business risk as they would not be able to hedge their purchases in Chinas domestic market. The same situation also impacted Chinas tin concentrate imports. The country imported some 171 tonnes of tin-in-concentrate in July, which was much lower compared to June. However, it is expected that this situation will only be temporary as the domestic price premium over the LME has since risen to a record high, which now makes importing very lucrative, even for general trade. Imports of tin ores is expected to rebound in August. The Customs data also showed that no refined tin was exported in July although for the January to July period some 973 tonnes of refined tin were exported. However, from incomplete import data of third countries, it is shown that China exported some 16,000 tonnes of tin metal from last October to May this year. It is believed that the country has ended its tin de-stocking activity as there is no price incentive to do so and no excess material left, and that Chinas tin imports is likely to rise for the remainder of this year. (Source: Tin in the News, ITRI Ltd. UK)
AUGUST 2011
Tin Statistics
AUGUST 2011
AUGUST 2011
AUGUST 2011
AUGUST 2011
10
AUGUST 2011
11
AUGUST 2011
12
AUGUST 2011
13
AUGUST 2011
14
AUGUST 2011
15
AUGUST 2011
16
AUGUST 2011
17
AUGUST 2011
18
AUGUST 2011
19

Malaysian Tin Bulletin-August &#39;11

Caricato da

Informazioni sul documento

Copyright

Formati disponibili

Condividi questo documento

Condividi o incorpora il documento

Opzioni di condivisione

Hai trovato utile questo documento?

Questo contenuto è inappropriato?

Copyright:

Formati disponibili

Malaysian Tin Bulletin-August &#39;11

Caricato da

Copyright:

Formati disponibili

MALAYSIAN TIN BULLETIN

August Tin Market Review