Peru mining tax talks continue   (07 Sep 2011)

The Peruvian Energy and Mines Ministry denied that talks with the National Society of Energy, Mines and Oil, an elite group of mining companies that together exported over US$21 billion of metals and minerals in 2010, have broken down.  The ministry confirmed that talks were continuing particularly on the legal and tributary text to be contained in the MOU.

The country’s PM, Salomon Lerner Ghitis announced on 25 August that miners in Peru had agreed to pay as much as 3 billion Nuevos Soles (US$1 billion) in taxes per year.  The measures are part of President Ollanta Humala’s pledge to invest in social programmes through raising mining royalties and taxing mining companies’ profits.  Investments in the Peruvian mining are expected to total some US$30 billion over the next five years.

Peru is the world’s largest silver producer, second-largest copper producer, and third-largest producer of zinc and tin.  The government collected US$646 million in mining royalties last year.

Bolivian royalty increases under discussion    (07 Sep 2011)

The Bolivian government is aiming to complete new legislation on royalties, taxes and control of mining concessions by end-October or by year-end at the latest.  Under the new legislation, tin royalties could be increased above the current maximum of 5%.  Politically powerful co-operatives, which account for some 40% of Bolivia’s tin production, are however, lobbying to be exempted from any increase.

The new mining legislation being drafted would also replace mining concessions with shared –risk or service-provider contracts, giving the state majority control in all metals project.

Eurotin updates on two Spanish projects    (05 Sep 2011)

TSX-listed Eurotin has recently provided updates on the status of two of its tin projects in Spain.

At the Oropesa primary deposit in southwest Spain, the results obtained over the past year are sufficiently promising to justify commencing a drill program for resource definition purposes.  At a cut-off grade of 0.5% tin, there have been 32 intercepts with an average grade of 0.86% and an estimated true width of 10.2 metres.

The Santa Maria tin deposit project, located in central Spain was a small scale open pit operation.  Now, Eurotin is more interested in the potential for the discovery of large alluvial deposits nearby and will start exploration drilling to test this concept later this year.

China imports and production decline in July    (26 Aug 2011)

According to data from China Custom, refined tin imports declined to 721 tonnes in July, down by 47% m-o-m.  Although the domestic tin price in China was higher than LME price in July, it was not profitable to import tin for general trade because of the 3% import duty and 17% VAT.  Also, the great volatility of LME prices made business risky because traders cannot hedge purchases in China market.  The situation also impacted tin concentrate import, which amounted to 171 tonnes in July.

China did not export refined tin in July.  Between January and June 973 tonnes of refined tin were exported.  It is estimated (from incomplete import data of third countries), China exported about 16,000 tonnes of tin metal from last October to this May.

According to the China Nonferrous Metals Industry Association (CNIA), China’s refined tin production decreased by 8% m-o-m in July to 12, 096 tonnes.  China’s tin-in-concentrate production for the January-July period rose by 17% y-o-y to 53,031 tonnes.

Lower volumes, higher margins for Timah    (26 Aug 2011)

Indonesia’s PT Timah reported a 29% rise in consolidated sales and a more than doubling of net income to Rp 689 billion (US$79 million) in the first half of 2011, despite a fall in tin sales volumes.  Refined tin sales for the January-June period fell by 12% y-o-y to 17,457 tonnes, despite a marginal rise in mine production (including purchases of ore) to 17,701 tonnes of tin-in-concentrate.

Offshore production fell by 9% to 8,255 tonnes, while supply from onshore mines (including small mines operating within Timah’s mining areas) rose by 11% to 9,446 tonnes of tin-in-concentrate.  Refined tin production in the first half fell by 5% to 18,455 tonnes.

Strong tin prices, peaking at over US$33,000 per tonne during Q2, boosted margins, which averaged US$5,865 per tonne in the first half.  Average production costs in the period were reported at US$22,136 per tonne, up 57% on the same period last year.  Timah forecasts its average realized price for refined tin will be around US$24,000 per tonne this year.
 

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