According to reports on Bloomberg, Indonesia, the world’s biggest tin supplier, is set to ship the least amount of the metal in a decade, which will extend shortages into a fourth year.
Statistics compiled by the news-wire from exporters and analysts suggested that sales will drop 24% to 75,000 metric tonnes due to the fact that many smelters won’t meet a higher purity standard that begins in July as well as the fact that ore reserves are continuing to diminish.
The metal, used extensively in consumer electronic products as well as a packaging material, is forecast to rise on the London Metal Exchange (LME) by around 17% this year to $28,750 a tonne.
Indonesia is increasing the purity of its tin so that it can sell directly to electronic companies rather than to refiners.
However, supply from Indonesian mines declined 10% last year with mine workers having to dig to increasing depths to find ore and with demand from electronics companies set to rise to keep pace with consumer appetite for their products, demand is expected to outpace supply by some 5,000 tonnes this year.
Speaking to Bloomberg, Duncan Hobbs, an analyst at Macquarie Group, said, “I see another deficit this year, probably a deeper deficit than last year.
“You’ve got to be pretty optimistic to think that Indonesia is going to do a lot more on the supply side.”
This stands in contrast to many other base metals including aluminium, copper, lead, nickel and zinc, all of which are expected to see surpluses to supply.
