Australia's Kasbah sees sharp rise in tin prices
MELBOURNE, Sept 10
MELBOURNE, Sept 10 (Reuters) - Kasbah Resources Ltd , an Australian company aiming to open a tin mine in Morocco in late 2014, said moves by top exporter Indonesia to tighten control over its tin industry will lead to a sharp rise in tin prices this year.
Kasbah's managing director, Wayne Bramwell, said on Tuesday the market could be 10,000-15,000 tonnes short of supply this year, which would drive prices higher for the metal used as solder material.
Indonesia's biggest tin producer, state-backed PT Timah, which produces about 30 percent of the country's tin exports, halted shipments last week, blaming new trading rules imposed by the government.
"The tin market is tightening up very, very rapidly," Bramwell told analysts in Melbourne.
Three-month tin on the London Metal Exchange has risen about 8 percent in past week to around $22,925 a tonne. Cash tin CMSN0-3 surged last week on tight supply to its biggest premium over three-month prices in three years, but has since eased.
Kasbah released an increased resource estimate for its Achmmach project in Morocco on Tuesday, showing a total measured and indicated resource of 123,000 tonnes of contained tin. It expects to release a final feasibility study later this year.
The biggest risk to the $167 million project has always been the tin price, but Bramwell said he was no longer too concerned about that.
"I can't construct an argument under any scenario to see tin under $20,000. I can really see a strong argument to see tin above $30,000," he told Reuters.
The project, expected to produce more than 6,000 tonnes a year of tin in concentrate, is 25 percent owned by two Japanese companies, Toyota Tsusho Corp and Nittetsu Mining Co , which are looking to diversify away from Indonesia and China for their tin supply.
"What they really want is security of supply," Bramwell said. (Reporting by Sonali Paul; Editing by Richard Pullin)
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