Indonesia's Timah Stops 6 Small Tin Dredges after Green Protest

Dec. 23 -- Indonesia's state-owned PT Timah temporarily stopped operations of six small tin dredges after protests from a local green group, the company's spokesman said on Wednesday.

It was not immediately clear if the action, which started on Wednesday, would affect production for next year, but it could potentially curb supplies from the world's largest integrated tin miner if it runs for a long period of time.

Timah has been boosting off-shore production because of declining, more easily mined onshore reserves on the country's main tin-producing islands off Sumatra.

The firm suspended operations of six cutter-suction dredges after a local green group said it wanted to assess the environmental impact, Timah spokesman Abrun Abubakar said.

"But we can't stop the operation for long," he added. "If it continues for longer it could affect production and we will have to relocate the dredges to other waters."

Each dredge can produce between 20-30 tonnes per week, according to Anhar Ramli, Timah's spokesman in Pangkal Pinang, the provincial capital of Bangka-Belitung, but they were mining in an area where reserves are thin.

Timah operates 12 cruise ship-like bucket-line dredges and 10 smaller cutter-suction dredges on top of 30 dredges operated by its partners. It is in the process of building another 5 cutter-suction dredges.

Timah has revised down its 2010 refined tin output to 40,000 tonnes or lower due to heavy rains hampering mining from an earlier forecast of 45-50,000 tonnes. [ID:nL3E6N809C]

Worries about declining supplies from Indonesia propelled benchmark tin on the London Metal Exchange to a record high of $27,500 a tonne in mid-November, but prices have eased and were at $26,400 a tonne on Wednesday.

The price of the silvery, malleable metal -- used in food packaging and as an electronics solder -- has gained 55.75 percent so far this year.