Indonesia’s PT Timah reported a significant fall in its mine and refined tin production in the first three quarters of 2012 and warned that adjustments to its mining operations required by law from 1 October would have a further adverse impact on productivity in the short term. The company now expects to produce only around 30,000 tonnes of tin in 2012, well below its previous target of 38,000 tonnes. “Because of the new policy there is confusion here and there,” Timah corporate secretary Agung Nugroho told Reuters, adding Timah was no longer allowed to buy tin concentrate from contractors.
Production of tin-in-concentrates in the nine months to September amounted to 24,357 tonnes, down by 14% compared to the corresponding period of 2011. Meanwhile refined tin production from the company’s two plants in Bangka and Kundur dropped by 18% to 23,255 tonnes.
Refined tin sales rose by 7% year-on-year to 26,921 tonnes, reflecting a run down in stocks this year. However the increased sales volume was more than offset by lower prices, with the average third quarter realised price of US$21,523/tonne dropping by 24% year-on-year.
.The state-controlled company’s net profit in the nine months to September fell by 57% to Rp370 billion (US$39 million), with average margin per tonne declining by 64% to US$1,750/tonne. It is now in the process of adjusting its mining and processing operations in response to the new regulations restricting the use of mining contractors and purchases of ore from small-scale mines. In the medium-term the company believes that this will improve its productivity, by-product recovery and sustainability. It also expects to bring its first deep water bucket wheel dredge into operation shortly.
