Indonesia's Timah plans March tin shipment to Japan

* Japan buys account for 18 pct of Timah's tin exports
* Timah to stick to delivery schedule for term buyers
* Infrastructure may make tin deliveries difficult -analyst (Timah corrects earlier statement on lack of Japan shipment) 

Indonesia's state-owned PT Timah (TINS), the world's largest integrated tin miner, will make a shipment to quake-hit Japan this month and is keeping its delivery schedule to term buyers, an official said on Thursday. 

Japan accounts for 18 percent of Timah's shipments, and the firm sends the metal to ports in southern Japan that have been unaffected by last week's devastating quake and tsunami in the northeast, corporate secretary Abrun Abubakar told Reuters. 

"We do have a schedule to ship tin to Japan this month and we will stick to the shipping schedule," the company's corporate secretary Abrun Abubakar told Reuters, without giving any further details on the shipment. 

Japan's demand for tin from Indonesia, the world's top exporter, will be reduced following the quake, but it is too early to assess the scale of the impact, consulting firm ITRI said earlier this week. 

"Timah ships the metal to ports in southern Japan such as Kobe, Kawasaki and Nagoya," said Abubakar. "That's why there's no delay in the tin shipment to Japan." 

Last month, Timah said refined tin production in 2010 was 40,413 tonnes, down from 45,086 tonnes in 2009 as heavy rains hampered mining and easily recoverable onshore reserves are declining, a trend that has driven tin prices to record highs this year.

Japan, the world's third-largest economy, was hit by a massive earthquake and tsunami last Friday. 

Operators of a quake-crippled nuclear plant in Japan dumped water on overheating reactors on Thursday while the United States expressed growing alarm about leaking radiation and urged its citizens to stay well clear of the area. 

"Some Japanese users' production facilities will be impacted, either by damage or power disruption," said David Thurtell, a Citi metals analyst in Singapore. 

"Whether they would stockpile material or stop importing is hard to say," he added. "Infrastructure damage may make delivery more difficult." 

Tin for three-month delivery on the London metal Exchange traded at $28,699 a tonne at 0626 GMT. The metal, used in solders and tinplate, touched an all-time high at $32,799 in mid-February. 

A crackdown on illegal mining since 2006, tighter export regulations, declining onshore reserves and rain that has hindered production in Indonesia have helped drive the tin rally.

"Tin concentrates would probably be easily absorbed in China or other parts of Asia," added Thurtell. "Mine concentrate shortages over the past six or seven months will have left plenty of spare refining capacity." 

Indonesia, which supplies nearly 30 percent of the world's tin, produced 78,965 tonnes of the refined metal in 2010, the energy and minerals ministry said late last year, but production is expected to reach 90,000 tonnes in 2011. 

Indonesia will restrict annual output to a 100,000 tonnes if record high prices trigger a new scramble for the metal, a senior official said in January. 

Late last month, Timah said that first-quarter production would be lower than expected because of rains and rough seas. Source: Reuters