INDONESIA tightened rules on tin trade by obliging domestic product makers to buy ingots only from the local exchange to manage supplies from the biggest shipper.
Solder and other tin products can only be exported if they’re produced using refined ingots from the tin exchange as the basic material, according to a decree signed by Trade Minister Rachmat Gobel effective August 1. The rule also requires shippers to obtain a clean and clear certificate to show the origin of the raw ore.
“It will create transparency because ingots that are sold at the exchange have to be already clean and clear,” Didi Sumedi, export director of mining and industrial products at the Trade Ministry, said by phone on Wednesday. “It will improve monitoring, as everything will be done through one door.”
Tin is the worst performer on the London Metal Exchange this year, as mining companies in Myanmar and Australia increase supplies. Indonesia has tried to support prices of the metal used in everything from cans to smartphones by restricting output and through policies aimed at controlling shipments.
The country toughened rules in 2013, obliging exporters to trade refined ingot at the Indonesia Commodity & Derivatives Exchange before shipping it overseas and raising purity levels. It tightened export standards again in November.
Producers have also curbed sales to try and revive prices, which have plunged 31 percent in the past year. Smelters will cut exports to 4,000 metric tons a month starting in May, according to Rustam Effendi, governor of the main producing region of Bangka Belitung. That’s less than the limit of 4,500 tons agreed in March.
Under the latest rule, exports are allowed only for three groups of products, which are refined ingot, solder and other items, such as plate, foil and strip with maximum 96-percent purity. Shippers must get approval from the Energy and Mineral Resources Ministry and from the Trade Ministry before they export tin, the rule says.
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