UPDATE 1-Indonesia's Timah sees refined tin output down up to 8 pct in 2011

(Adds details, quotes)

Feb 16 (Reuters) - Indonesia's state-owned PT Timah
, the world's largest integrated tin miner, on
Wednesday estimated its refined tin production this year at
between 37,000 and 40,000 tonnes, up to eight percent down on
last year.

The forecast is likely to add to bullish sentiment on the
metal after falling supply from Indonesia, the world's top
exporter, has been driving a rally in the past year in benchmark
London tin prices to a fresh record high on Tuesday.

The miner earlier this month said refined tin production in
2010 was 40,413 tonnes, which was down from 45,086 tonnes in
2009 as heavy rains hampered mining and easily recoverable
onshore reserves are declining.

"Excessive supply will not be good for maintaining the
world's tin price," the company's corporate secretary Abrun
Abubakar told Reuters on Wednesday. "We will always control our
production rate for reserve conservation purposes."

Indonesia, the world's top tin exporter, will limit annual
output to a maximum of 100,000 tonnes if record high prices set
off a scramble for the metal, a senior mining official said last
month.

Three-month tin on the London Metal Exchange soared to a
record high of $32,799 a tonne on Tuesday as prospects of supply
constraints from top exporter Indonesia attracted investors.

Indonesia, which supplies nearly 30 percent of the world's
tin consumption, produced an estimated 105,000 tonnes in 2010.

"We still cannot publish our 2011 working programme, but
output is estimated to be between 37,000 to 40,000 tonnes,"
Abubakar said.

A Reuters survey published late in January showed analysts
expecting a deficit of 15,000 tonnes in the tin market this
year.

The average of 24 forecasts showed the cash tin price
would average $27,000 a tonne this year, and rise to
$27,419 next year.

"The story for PT Timah is, even though they have production
lower than previous years, they have benefited from the
increasing tin price in the global market," said Norico Gaman,
head of research at PT BNI Securities.

"With the tin price increasing more than 30 percent in 2010,
this benefits an improving net profit (outlook) for Timah."

Timah said this month it expects a 2011 net profit of around
1 trillion rupiah ($111.2 million), boosted by rising global tin
prices.

Tin consultants ITRI last month estimated 2010 global tin
consumption at 360,300 tonnes, up 12.5 percent.

Demand for the metal, used in electronics, plating and
lead-free solders, is seen rising in the coming years, while
analysts have for months forecast that Indonesian output will
fail to keep pace due to a lack of investment in mining.

In addition, a crackdown on illegal mining since 2006,
tighter export regulations, as well as declining onshore
reserves and rainy weather, have all hindered production in
Indonesia.

(Reporting by Alfian; Writing by Michael Taylor; Editing by
Neil Chatterjee)