Ban on tin ore export to start June 15
Adianto P. Simamora, The Jakarta Post, Jakarta
The government will ban the export of tin ore from the Bangka and Belitung islands starting June 15 in a bid to help prop up sagging prices of the commodity, Minister of Industry and Trade Rini M. Soewandi said on Thursday.
"The ban on tin ore export will start June 15," Rini told reporters.
The ban was initially planned to start this month.
Rini said that the delay was made following demands from the local governments of the Bangka and Belitung regencies, to give more time for investors to set up local tin smelting facilities.
Illegal tin mining has been the main source of living for some 6,000 people of the two islands. Banning the export of tin ore would force them out of business.
Tin ore produced by the illegal miners is estimated to reach more than 30,000 metric tons per year or close to the production level of state-owned tin mining company PT Timah. The tin ore output of the illegal miners is being exported.
Timah, whose net profit plunged by 89 percent last year, had blamed the illegal miners for causing a drop in the international price of tin. The company has said that unless the government does something about the illegal mining operation, Timah would go under.
The Bangka and Belitung regency governments have invited private investors to set up smelting facilities to process tin ore into tin metal, which would help increase the price of tin in the international market.
"(But) the regents of Bangka and Belitung islands have asked me to delay the ban because the investors are not yet ready," Rini said.
Tin price reached its lowest level in three decades in September last year at around US$3,630 per ton, while Timah's production cost stands at about $4,200 per ton.
But on Thursday at 5 p.m., the commodity was quoted at $4,100 per ton, which is still much lower than the $5,225 per ton in January 2001.
Timah's full capacity is 50,000 metric tons a year, but the company is currently running at only 70 percent capacity.