DUBAI, Mar. 30 -- Tin prices are not expected to exceed $18,000 per tonne in 2010, as slow demand from the U.S. would help offset a possible supply cut from Indonesia, the chief executive of an India-based alloy firm said on Sunday.
"I don't expect that prices will rise above $18,000 this year; there isn't too much demand. The U.S. used to be a top importer, but because of the slowdown it's not any more," said Persang Bavaadam, managing director of Persang Alloy Industries, which produces solders used in electronic products.
Indonesia, the world's top tin exporter expects around a 50 percent drop in output from its main producing islands of Bangka-Belitung in 2010 as a new mining law comes into operation, an official told Reuters in March.
Tin for three-month delivery MSN3 on the London Metal Exchange settled at $17,650 a tonne on Friday. Prices for the metal, mainly used in food packaging and for soldering electronic products, rose about 58 percent in 2009.
Markets that still have a growing demand for the metal include India, China and Thailand, said Bavaadam.
"India still has a growing economy and will continue to expand its tin manufacturing sector," he said.
Even if prices were to rise above the $18,000 mark this year, growth in the tin can industry is expected to continue, said Abesh Chatterjee, head of international trade at The Tin Plate Company of India, which has a capacity to produce 380,000 tonnes of tin plates per year.
"Tin is only 3 to 4 percent of the cost of making a tin plate, and the food industry is growing at such a high pace with the rise of population, so even if the price of tin goes up this will not dampen growth in the tin can industry," he said.
The company has two tin plate plants, one of which is operating at full capacity of 180,000 tonne per year (tpy), and a newer plant with 200,000 tpy which is operating at around 50 percent and will reach full capacity by the end of the year, said Chatterjee.