Govt supervises tin ore exports
Adianto P. Simamora, The Jakarta Post, Jakarta
The government has issued a new ruling on the export of tin, which stipulates that it can only be done by licensed exporters.
The ruling was included in Decree No. 57/2002 signed on Thursday by Minister of Industry and Trade Rini Soewandi. The minister also signed Decree No. 58/2002 on the export of rubber. The two decrees were effective as of Friday.
Under the new decree, tin is now considered a strategic commodity and its trade must be supervised by the government.
The move has long been anticipated, particularly by the state- owned tin mining company, PT Timah, which has faced serious trouble from widespread illegal tin mining activities at the company's sites on the islands of Bangka and Belitung. Tin ore extracted by illegal miners has caused tin prices to plunge on the international market, and has pushed publicly listed Timah close to bankruptcy.
The ruling, however, does not prohibit the export of tin ore.
But director general for foreign trade at the Ministry of Industry and Trade Sudar S.A. told The Jakarta Post that the government would eventually ban the export of tin ore to help boost tin prices.
Sudar said that tin ore exporters must now obtain a license from the government.
"All tin exporters must obtain a license from the central government, while the export quota will be regulated by the local administration," Sudar said.
Timah director Maryat Nirwandy hoped that the new ruling would help prop up the sagging price of tin.
"We welcome the new ruling," Maryat told The Post.
Timah, which exports tin in the form of metal, has repeatedly blamed rampant illegal mining at its mining sites on Bangka and Belitung for causing a plunge in tin prices. Illegal mining now almost equal Timah's annual tin production of 40,000 tons.
Timah said that it would cut output to 34,000 tons this year.
Since the middle of 2001, tin prices have fallen to US$3,630 per ton, the lowest level in the last three decades, while Timah's production costs stand at about $4,200 per ton.
Meanwhile, the new ministerial decree on the export of rubber gives the Rubber Association of Indonesia (Gapkindo) a role to execute the government's plans to cut the country's rubber exports to help push up the price of the commodity.
The export-cutting plan is part of a tripartite agreement with Thailand and Malaysia.
The government earlier said that Indonesia would cut exports in 2002 by 10 percent to some 1.23 million tons.
The government also said that it would cut rubber output by 60,000 tons this year and 75,000 tons next year through replanting old rubber plantations, prohibiting the expansion of rubber-growing areas and switching to the cultivation of other crops.
Indonesia is the second largest rubber producer in the world after Thailand, which produced 1.55 million tons last year.