Indonesian state-controlled tin producer PT Timah’s net profits were 137.1 billion rupiah ($12.5 million) in the first six months of the year, down by 60% compared with 335.9 billion rupiah over the same period in 2012, the company reported. Production of refined tin dropped by 36% to 9,613 tonnes in the first half, from 14,984 tonnes in the same period last year, while refined metal sales also fell by 36% year-on-year to 10,951 tonnes. Tin ore production fell by 40% to 10,187 tonnes, mainly due to an 80% fall in onshore production as supplies from small-scale mines operating on Timah’s mining leases dried up.
“Our profits slumped because production dropped, costs increased, while prices were flat,” Timah CEO Sukrisno told Reuters, adding that demand has started to pick up and that production should increase in the second half. The company’s recently revised sales target for the year is 28,000 tonnes. Timah and other Indonesian producers have also been helped recently by a depreciation in the value of the rupiah.
In a statement Corporate Secretary Agung Nugroho said that the company continues to pursue its strategy of establishing a production base in Burma/Myanmar. Following the completion of licencing, exploration activity will begin later this year with production possible in 2014. The likely scale of production will depend on the exploration results. In another move, the company said that it will switch from diesel to electric power for its furnaces, cutting operating costs. With support from state electricity company PT PLN the change is also expected to be made next year.
