Malaysia tin up to 8-year high<\/p>\n
KUALA LUMPUR (Reuters): Malaysia's spot tin price rallied to
\nan eight-year high yesterday, and industry sources and traders
\nsaid prospects for the metal remain bullish on the back of a
\nfalling ringgit currency.<\/p>\n
\"Tin is seen climbing to 21 to 22 ringgit if the ringgit
\ncontinues to slide further in the near-term. Tin depends solely
\non currency fluctuations,\" said an industry source.<\/p>\n
A weak ringgit makes Malaysian exports more competitive.<\/p>\n
\"The situation in the local currency is not yet stable and
\nthis has somewhat triggered a bullish sentiment in the market,\"
\nthe source said. \"I think KLTM prices are more influenced by the
\ncurrency rather than supply and demand factors.\"<\/p>\n
On Tuesday, tin prices on the Kuala Lumpur Tin Market (KLTM)
\nsurged 1.18 ringgit to 20.92 ringgit a kg, the highest level
\nsince October 1989 when the price hit 21.60 ringgit.<\/p>\n
Tin prices have risen by about 44 percent since starting to
\nrise from 14.50 ringgit in August, traders said.<\/p>\n
\"The ringgit fell to a new low on Tuesday morning. People
\npanicked and started to scramble to buy tin for fear that prices
\nwould rise further on the currency,\" a senior dealer based in the
\nnorthern state of Penang said.<\/p>\n
The Malaysian ringgit tumbled to a record low of 3.62 to the
\ndollar on Tuesday, down over 30 percent since July.<\/p>\n
\"Demand is expected from Europe and the U.S. as they could
\npurchase cheaper metal here in ringgit terms,\" the trader said.<\/p>\n
\"Fundamentally the market is sound. Stocks in London Metal
\nExchange warehouse is seen decreasing. Local supply is tight as
\nmost mines have shut down recently,\" the trader said.<\/p>\n
The industry source added: \"In the U.S., demand for tin in
\nthat country remains good with tin users, especially in the
\nsolder and chemicals industries remaining buoyant.\"<\/p>\n
But the source said the current financial turmoil could affect
\ndemand.<\/p>\n
\"Like in Japan, there is a slowdown in construction industries
\nwhich used base metals like tin.<\/p>\n
\"The effect of the financial crisis in Southeast Asia has
\ncreated nervousness in the economies of the region. Like in Asian
\nproducer countries like Thailand, Indonesia and the Philippines,
\nwe feel demand here will be reduced as the local price has risen
\nsharply,\" the source added.<\/p>",
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