Government set to ban tin ore exports

Government set to ban tin ore exports

Moch. N. Kurniawan, The Jakarta Post, Jakarta

The government is to issue a ruling next week to ban the
export of tin concentrate in a bid to curb illegal mining, a move
which could stop state-owned tin mining company PT Timah from
going to the wall, a senior official said on Wednesday.

The director general of geology and mineral resources at the
Ministry of Energy and Mineral Resources, Wimpy S. Tjetjep, said
the Ministry of Industry and Trade had promised to revise the
existing Ministerial Decree No. 146/1999 which permitted the
export of tin concentrate.

"The Ministry of Industry and Trade has agreed to ban such
activities. I predict (the decree) will be issued on January 15,"
he told reporters.

Wimpy said the new decree would turn tin into a strategic
commodity whose trade would consequently be supervised by the
Ministry of Industry and Trade.

He said that the government would only allow the export of tin
metal.

He expected the new ruling would bring to an end the
activities of illegal miners, especially in the Bangka-Belitung
islands, who only produced concentrates.

Meanwhile, Director General for Foreign Trade Sudar S.A
declined to say when the new decree would be issued.

"It could be issued before or after Jan. 15. All the relevant
parties will hold further talks prior to the issuance of the
decree," he told The Jakarta Post.

Timah has reportedly blamed illegal tin miners, who have
flooded the world tin market with tin concentrate, for causing
the current plunge in the price of the commodity and sending the
company into near bankruptcy.

It said that tin prices on the world market had declined to
US$3,500 per ton as of December last year from over $5,000 in
2000, while Timah's production costs stood at $4,300 per ton.

Timah booked Rp 25 billion (about US$2.5 million) in unaudited
net profit for the first nine months of this year, 92 percent
lower than the Rp 296 billion profit booked in the same period of
last year.

The firm has had to take cost cutting measures to cope with
the problem, including reducing working hours and halting the
operation of uneconomical dredgers.

At present, there are 6,000 illegal mining operations
involving 30,000 unauthorized miners on Bangka, and they have
already encroached on 32 percent of Timah's former mines.