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Some smelters in China’s tin heartland of Yunnan are having to stop operating because of restrictions on power consumption in the southwestern province, the International Tin Association (ITA) said on Wednesday.
Yunnan relies mainly on hydropower for electricity but has been suffering from drought this month. Local aluminium and zinc smelters have already been affected by power shortages in the province, which is home to tin firms including state-run Yunnan Tin, the world’s top refined tin producer.
“In order to cope with the limited power capacity, all major enterprises in Yunnan province have been forced to reduce consumption,” the association said.
“According to ITA research, only private smelters will be impacted and will have to cease both smelting and refining activities,” it added, estimating they will have to close for 10-20 days.
The association sees 1,000-2,000 tonnes of refined tin production being lost as a result of the measures. China produced around 15,300 tonnes in April.
Tin prices on the London Metal Exchange were trading up 1% at $29,775 a tonne as of 1144 GMT, having hit a decade high of $30,650 last week.
“Currently, heavy rains are forecast for June, which will refill the hydropower reservoirs,” the ITA said. “However, it is unknown how long this will take, and smelters are currently in the dark about restarting.”
(By Tom Daly; Editing by Chizu Nomiyama)
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