* Indonesia targets tin price of $25,000-$29,000/T this year
* Tin ingot export volumes to drop further in Sept -official (Adds trade minister comment)
By Yayat Supriatna and Michael Taylor
JAKARTA, Sept 20 (Reuters) - Indonesia is aiming for as muchas a 25 percent jump in its tin prices from current levels, aregulatory official said, just weeks after the world's topsupplier of the base metal made it mandatory for exporters totrade on a domestic exchange.
State-owned PT Timah, Indonesia's top tinexporter, and 18 others stopped shipments earlier this month,blaming new trading regulations that Jakarta hopes will help thecountry establish its own benchmark pricing and boost the valueof its exports.
"By imposing the new tin trade rules we have set a tin pricetarget at $25,000 to $29,000 a tonne this year," Sutriono Edi,head of Indonesia's Commodity Futures Trading Regulatory Agency,told Reuters on Friday.
"It is better for us to export less volume but for highervalue and better prices, rather than export a bigger volume butwith low value and low prices," he said, without giving detailson what action the government might take to boost prices.
Indonesia has already banned exports of tin ingots with lessthan 99.9 percent purity and has made it compulsory for all 47registered exporters to trade on a domestic exchange beforeshipping material.
Indonesia's tin ingot exports fell to an 11-month low inJuly and were little-changed for August partly because of thepurity rule.
Edi expects shipments to drop further in September due tothe new trading regulation, but he sees higher prices making anydecline worthwhile.
Earlier this month, a trade ministry official said exportswould return to normal in one to two months.
Lower tin supply from the top exporter has pushed upbenchmark London prices by 18 percent since the end ofJune to around $23,285 per tonne currently.
The tin contract on the Indonesia Commodityand Derivatives Exchange (ICDX) last traded at $23,195 pertonne, versus $21,500 at the start of September. But liquidityhas been a problem as only five sellers, including PT Timah,have joined the exchange.
A second group of 18 smelters from Indonesia's maintin-producing Bangka-Belitung region have refused to registerwith the ICDX, and instead want to trade on the unapprovedJakarta Futures Exchanges (JFX).
Government officials have repeatedly urged the ICDX and JFXto merge their tin contracts and create a single Indonesianbenchmark price, although Trade Minister Gita Wirjawan said onFriday that he had asked COFTRA to explore the option of runningtwo tin contracts. (Editing by Himani Sarkar and Jason Neely)
- Politics & Government