Tin prices have continued their downward decline in the last month, with spot tin falling to $18,745 US a tonne on the London Metal Exchange as of July 16. The metal continues to decline from the six-month high of $25,650 it reached on February 8.
Prices continue to be negatively affected by the slowdown in China, the European debt crisis and weakness in the US economy.
Even so, tin prices could be helped in the short term by a decline in production from Indonesia, the world’s second-largest producer. The country’s tin exports fell 7.2 percent in June from May, to 7,300 tonnes, according to Bloomberg Businessweek.
“Traditional tin dredgers have to stop production on the east coast of Bangka because the southeast wind is very strong,” Johan Murod, commissioner of Belitung-based smelter PT Tommy Utama, told Bloomberg. “Miners are reluctant to work because of low prices,” he added.
However, underlying demand should continue to increase. According to a recent survey released by tin industry group ITRI, global tin use will rise slightly, to 365,000 tonnes in 2012 from 360,000 tonnes in 2011. Thereafter, the organization feels a global growth rate of around 2 percent a year is possible.