The impact of Indonesia’s Ministry of Trade Regulation No 32/2013 on the local industry and global market continues to dominate attention. Bloomberg reported that the Indonesia Commodity and Derivatives Exchange (ICDX), through which all tin ingot exports must now be channelled, may cap trading volumes, while Reuters quoted unconfirmed reports that five London Metal Exchange member companies were considering ICDX membership. Meanwhile Indonesia’s Trade Minister cancelled a plan to visit Bangka to meet private smelters and other parties seeking changes to the regulation.
ICDX Head of Business Development Christilia Angelica told Bloomberg in an interview that it may keep monthly trading volume in physical tin at 5,000 tpm. “We have discussed this with our seller members, that there will be some trading limits to support prices, and they have agreed,” she said. Sales last month rose to 3,020 tonnes, while turnover in the first 8 trading days of November amounted to 860 tonnes.
Angelica also said that ICDX will accept as members only smelters that have clear permits and ore supplies that can be accounted for, and that it doesn’t expect all smelters to join. It also supports plan by PT Timah and the Bangka Belitung provincial government for Timah to buy tin from smelters that aren’t allowed to export, for sale through the exchange. The exchange has 28 tin trade members, with 17 active so far and another seven expected to start trading soon. The main international companies who are already members are Noble, Toyota and Daewoo
According to Reuters, international firms said to be eyeing ICDX membership by sources who declined to be named are JPMorgan, Standard Bank, brokerages Newedge and Triland Metals, and AMT, the metals trading arm of AMC Group. JPMorgan, Newedge, Triland and AMT are ring dealing members of the LME, while Standard Bank is a category two member. Most are active in physical tin trade. However a Standard Bank spokesman said the South African bank was not considering joining the ICDX, while a spokesman for Newedge said the broker had no immediate plans to join. AMC and JP Morgan said they could not immediately comment on the matter. Triland did not return a request for comment. “We do believe in the tin story, especially in the medium to long term. If it means that we have to join in order to trade Indonesian tin … then we have to join,” said a trader at one of the firms, adding no final decision had been made.
