PANGKAL PINANG, Jun. 18 -- A tin smelter in Bangka island, Indonesia's main source of tin, has shut down because of financial difficulties, an industry official said on Friday, citing fluctuating tin prices and tight tin ore supplies.
PT Donna Kembara Jaya, which closed down last week, exported 5,176 tonnes of refined tin in 2008, accounting for about 6 percent of Indonesia's total tin exports that year, according to data from Bangka's mining office.
The tin smelter exported 574 tonnes in the first quarter of 2009, the most recent data currently available.
Johan Murod, director of PT Bangka-Belitung Timah Sejahtera which groups seven smelters including PT Donna Kembara Jaya, said the tin smelter had shut down because of financial problems.
"Tin prices have been fluctuating in the past years and it is difficult for us to determine costs of buying tin ore from traditional miners," Murod told Reuters.
"So the owner of the smelter has decided to shut the smelter for good," he said.
Murod did not give details of the smelter's production capacity.
Over the past four years, the tin industry in Indonesia's main tin-producing islands of Bangka-Belitung, off Sumatra, has been hit by weaker tin prices, a police crackdown on illegal mining, and the depletion of easily mined onshore reserves. (Reporting by Fitri Wulandari and Dwi Sadmoko; Editing by Sara Webb)