* 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 much as a 25 percent jump in its tin prices from current levels, a regulatory official said, just weeks after the world's top supplier of the base metal made it mandatory for exporters to trade on a domestic exchange.
State-owned PT Timah, Indonesia's top tin exporter, and 18 others stopped shipments earlier this month, blaming new trading regulations that Jakarta hopes will help the country establish its own benchmark pricing and boost the value of its exports.
"By imposing the new tin trade rules we have set a tin price target 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 higher value and better prices, rather than export a bigger volume but with low value and low prices," he said, without giving details on what action the government might take to boost prices.
Indonesia has already banned exports of tin ingots with less than 99.9 percent purity and has made it compulsory for all 47 registered exporters to trade on a domestic exchange before shipping material.
Indonesia's tin ingot exports fell to an 11-month low in July and were little-changed for August partly because of the purity rule.
Edi expects shipments to drop further in September due to the new trading regulation, but he sees higher prices making any decline worthwhile.
Earlier this month, a trade ministry official said exports would return to normal in one to two months.
Lower tin supply from the top exporter has pushed up benchmark London prices by 18 percent since the end of June to around $23,285 per tonne currently.
The tin contract on the Indonesia Commodity and Derivatives Exchange (ICDX) last traded at $23,195 per tonne, versus $21,500 at the start of September. But liquidity has been a problem as only five sellers, including PT Timah, have joined the exchange.
A second group of 18 smelters from Indonesia's main tin-producing Bangka-Belitung region have refused to register with the ICDX, and instead want to trade on the unapproved Jakarta Futures Exchanges (JFX).
Government officials have repeatedly urged the ICDX and JFX to merge their tin contracts and create a single Indonesian benchmark price, although Trade Minister Gita Wirjawan said on Friday that he had asked COFTRA to explore the option of running two tin contracts. (Editing by Himani Sarkar and Jason Neely)