Tin Council props up tumbling price

Press, 16 March 1982, Page 37

Tin Council props up tumbling price

NZPA-Reuter London The International Tin Council's buffer stock manager moved into the London market last week to bolster the price of the metal, which has tumbled since a mystery buyer withdrew support last month.

Dealers said heavy buying by the buffer stock manager. Pieter de Koning. pushed the price of tin for supply in three months $256 higher than its closing price last Wednesday to $16,426 a tonne. They estimated that 7000 tonnes of tin was traded on the London market on Thursday- afternoon.

The mystery’ buyer, who is believed to have connections with Malaysia, the largest producer, pushed the tin price to a record $20,970 a tonne last month before withdrawing support and letting the market collapse. The tin price has fallen by more than $4660 since then. Dealers said continued selling by the mystery operator took the price to a sevenmonth low of $15,720 a tonne before the buffer stock manager intervened.

The buffer stock was set up under the International Tin Agreement (1.T.A.) between producers and consumers to try to stabilise the price of the metal. The mystery buyer, who fojx months had propelled prices higer in a billiondollar buying spree, suddenly dropped out of sight.

Earlier last week, the International Tin Council agreed to more than double the amount of tin it can buyon world markets to help support prices. The council, comprising bf tin-pfoducing and consuming nations, said it would call on members to provide about $233 million in contributions to enable it to buy up to 26.500 tonnes of tin for its price-supporting buffer stockpile. Its previous authorised level of purchases was about 12.000 tonnes.

I.T.C. delegates said about SI9SM yvould come from tinproducing countries like Malaysia. Indonesia. Thailand and Bolivia. An additional $34.9M will come from outstanding pledges by Britain. Belgium. Canada, and Japan and neyv voluntary contributions by France and the Netherlands.’ Under I.T.C. rules, the buffer stock manager is required to buy tin for the stockpile when tin prices fall below a set level and sell it when it exceeds an unper limit.