Macro Sentiment Intertwines with Fundamentals, SHFE Tin Struggles to Find Direction, Focus on Marginal Changes [SMM Tin Morning Meeting Summary]

SMM Tin Morning Briefing on July 20, 2026

Market Review: The most-traded SHFE tin contract continued to swing wildly at highs last week. Its price center fluctuated under the alternating influences of repeated geopolitical conflicts and shifting expectations for US Fed interest rate hikes, with an overall trading range around 404,000–421,000 yuan/mt.

Spot Transaction: In the spot tin ingot market, transactions were overall weak last week. At the start of the week, after prices surged rapidly, downstream users showed strong fear of high prices, significantly dampening buying interest. Mid-week, as futures pulled back to low levels, some point-price orders for essential needs were released, causing a slight recovery in transactions, but the rush to buy amid continuous price rise quickly cooled after prices surged in the afternoon. Toward the weekend, futures rose again, suppressing market activity; only a few enterprises placed low-price orders to test the market. Although suppliers quoted actively, the market was mostly wait-and-see, leaving overall trading sentiment relatively sluggish.

Supply Side: The tightness in ore supply remained unchanged. Production resumptions in Wa State, Myanmar, were still slow. Some smelters in Yunnan faced TC pressure due to ore constraints, and a few smelters underwent maintenance or made production cut adjustments. However, the arrival of imported tin ingots and the release of earlier invisible inventory provided marginal replenishment, leaving the supply side “tight but not scarce.”

Demand Side: Amid the traditional consumption off-season, downstream solder and electronic processing enterprises saw flat order books. Coupled with the backlash of high tin prices, purchases were mainly for essential needs and small-scale restocking on dips. End-user markets diverged: PV welding strip and home appliance sectors performed unevenly, while order transmission along the semiconductor chain had yet to materialize.

Inventory: China’s tin ingot social inventory continued destocking to a low for the year. Inventories in bonded areas and LME warehouses showed relatively small changes. Low inventory provided clear support to the price bottom, but the pace of destocking slowed.

Market Forecast:

On the international macro front, the global semiconductor industry continues to ramp up investment driven by the AI wave. Samsung is advancing the start of chip factory commissioning, while SK Hynix has warned of extremely tight memory supply in 2027, reflecting the long-term demand potential for high-end chips and supporting materials. However, a Bank of America report points out that the actual growth rate of South Korean wafer capacity is far below target, Coreweave is seeking to hedge downside risks in memory chip prices, and ASML's price-hike plan faces potential conflict with TSMC, indicating intensifying tug-of-war between upstream and downstream in the supply chain, which has led to increasingly complex macro sentiment.

At home, the tin market continued to be characterized by a tug-of-war between “strong reality and weak demand.” Although social inventory has destocked to a low for the year, providing solid bottom support for prices, the supply-demand imbalance remains pronounced. Supply side, the tightness in ore has not fundamentally changed, but marginal improvement signals have increased. Demand side, the traditional off-season effect deepened, with downstream solder and electronic processing enterprises remaining cautious in procurement. Meanwhile, high tin prices significantly suppressed demand, with market transactions mostly based on essential-needs orders.

In summary, tight tin ore resources and low inventory strongly support tin prices, but sluggish off-season demand and downstream fear of high prices cap upside room. Prices are expected to consolidate at high levels this week. Investors should maintain a range-trading mindset, monitor the pace of ore supply improvement and downstream restocking willingness on price pullbacks. Purchases on dips are acceptable, but chasing rallies is not advised. Watch for a shift in macro sentiment and the risk of a pullback from high prices weighing on demand.