Govt to ban tin ore exports next month

Moch. N. Kurniawan, The Jakarta Post, Jakarta

The government is expected to issue a ruling by the end of this month to bar the export of tin concentrate in a bid to help curb illegal mining and to help avoid the ailing state-owned tin mining firm PT Timah from collapsing, according to a senior government official.

"The draft is final and it's now in the hands of Minister of Industry and Trade Rini Soewandi ... We hope the ruling will be issued by the end of this month," Husin Bagis, head of the mining division at the Ministry of Industry and Trade, said on Wednesday.

He said the new ruling might come into effect next month.

The new ruling will revise the prevailing ministerial decree No.146/1999 that permits the export of tin concentrate and will turn tin into a strategic commodity whose trade will consequently be supervised by the government.

It will only allow the export of tin metal, which only PT Timah and PT Kobatin -- another tin mining company operating in Bangka-Belitung province -- are able to produce.

As a consequence, the new ruling will bring to an end the activities of illegal miners, who only produced concentrates.

However, Husin said, the new ruling would provide a transition period of between four and 12 months before the export of tin concentrate would be fully banned.

"The transition period should minimize social unrest if protests emerge," he said.

Timah spokesman Prasetyo B. Saksono hailed the planned ruling, saying that along with the company's cost cutting measures, it would help solve Timah's difficulties.

The firm has had to take cost cutting measures to cope with its problems, including reducing working hours and halting the operation of 10 uneconomical dredgers.

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.

At present, there are 6,000 illegal mining operations involving 30,000 unauthorized miners on Bangka Island.