Malaysia Smelting invokes force majeure, halting local tin trading
(Updates with KLTM confirmation)
June 9 (Reuters) - Malaysia Smelting Corporation (MSC) Bhd , the world's third-biggest refined tin maker, said on Wednesday it had declared force majeure on its deliveries to customers because of coronavirus-related disruption to production. The move prompted the Kuala Lumpur Tin Market (KLTM), a local platform for physical tin deals, to suspend trading until further notice because of a lack of transactions, the International Tin Association (ITA) said in a statement. KLTM confirmed in an emailed statement to Reuters on Thursday that trading had been suspended after MSC declared force majeure.
MSC said in an exchange filing it had notified customers of a temporary suspension in its tin mining and smelting operations from June 4-14 to adhere with lockdown measures in Malaysia, where COVID-19 cases have spiked. Invoking the force majeure clause allows companies to suspend their obligation to fulfil contracts after unexpected events such as strikes and natural disasters. MSC churned out 22,400 tonnes of refined tin in 2020, according to the ITA, equivalent to around 7% of global supply. The suspension will have an impact on MSC's operations and financial performance in 2021, the company said, without elaborating. All contractual obligations are immediately suspended, it added.
"The company will notify the customers of the termination or cessation of the force majeure notice as soon as we are able to resume the level of operations that will enable MSC to meet its contractual obligations," it said. The ITA noted MSC was still appealing for the right to operate as an essential business and had already flagged production issues in April.
"This latest disruption is, for now, relatively short-term, but critically depends on the next phase of government action," it added. The KLTM did not immediately respond to a request for comment outside of normal trading hours. On the London Metal Exchange, three-month tin was down 0.2% on $31,155 a tonne as of 1256 GMT, after hitting a decade-high of $31,470 on Tuesday.
(Reporting by Mai Nguyen and Tom Daly; Editing by Louise Heavens and Jan Harvey) Messaging: email@example.com))