The third-largest producer of refined tin issued a notice of force majeure after the Malaysian government did not grant the company’s appeal for status as an essential service during the country’s new covid-19 lockdown.
MSC accounted for around 6% of global refined tin production in 2020
Under the Malaysian government’s new movement control order, the tin producer has been ordered to suspend operations until at least June 14, 2021.
MSC halted production on June 3 and suspended all contractual obligations 4 days later.
This marks a new blow to MSC, with the company already operating under restrictions since late April 2021, as a result of multiple furnace failure and rebricking work at its Butterworth smelter, with the company set to operate at limited capacity until the end of 2021.
MSC accounted for around 6% of global refined tin production in 2020.
The positive momentum in tin prices has aided a turnaround in MSC for the first quarter ended March 31, 2021 as
the group recorded a net profit of RM22.12 million ($5.37 million) compared with a loss of RM13.19 million ($3.2 million) a year ago.
With MSC temporarily suspending operations and operating at restricted capacity until the end of 2021 once operations resume, Roskill estimates around 5-10kt of refined tin to be impacted.
“The ongoing situation at MSC has likely played a major role in the recent tin price movements, with LME cash prices hitting an all-time high of US$34,462/t in early May 2021,” Roskill said.
“With both LME and SHFE stocks dropping below 1,000t in May, MSC’s force majeure notice will only continue to add pressure to the ongoing market tightness.”
Related article: Home: No relief for turbulent tin price as supply squeeze worsens
