Malaysian tin rose $40 on Tuesday, smashing the psychological resistance of $8,000 a tonne, as Japanese buyers kept up with their voracious appetite for the metal despite rocketing prices.
Dealers said the market could hit $9,000 in about one to 1 1/2 months if there was status quo in demand and fundamentals such as tightness of tin stocks on the London Metal Exchange (LME) and US dollar weakness.
The Kuala Lumpur Tin Market's spot price rose to $8,030 a tonne on a volume of 70 tonnes, from Monday's close of $7,990, done on a trade of 65 tonnes.
"The next immediate resistance is $8,500, though I suspect we'll hit $9,000 in about one to one-and-a-half months if things continue the way they have been going," said a trader.
The Japanese, who use tin extensively for soldering purposes in their electronics industries, joined local interests to bid for 95 tonnes against the 53 initially put out for sale.
Buyers later trimmed their bids by 25 tonnes while sellers raised their offers by 17 to strike a match.
Tight supplies have caused tin prices on both the London and Malaysian markets to rally since last year.
Tin stocks on the LME stood at 11,415 tonnes at Monday's close, less than a third of the record 39,475 tonnes seen in August 2002.
But LME's tin price closed flat overnight at $7,890 a tonne.
Dealers said Tuesday's rise on the KLTM, as well as recent gains, have widened the premium for shipping a tonne of local tin to Europe to $350 from last week's close of $275.
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