Night session continued to rise and stood firmly at 428,000, downstream mainly priced on demand at 424,000-426,000 [SMM Tin Morning News]

Futures

LME: LME 3-month tin closed at $55,803/mt on August 20, up $253 or 1.11%; on August 21 morning session it was quoted at $55,850/mt, up 0.54%, with an intraday high of $55,850——Tin led the gains among London base metals (Zn +1.07%/Pb +0.64%/Sn +0.54%/Cu -0.06%/Ni -0.98%/Al -1.30%), extending the divergence pattern of "strong lead, zinc, tin; weak copper, aluminum, nickel". LME tin inventory on August 20 decreased by 130 mt, remaining at historically extremely low levels.

China: SHFE tin 2609 (the most-traded contract) closed in the daytime session at approximately 426,250 yuan/mt; in the night session (8/21 01:02), 2609 closed at 428,230 yuan/mt, up 3,180 yuan or 0.75%, with open at 424,000, high 429,580, low 423,100, trading volume 64,400 lots, open interest 30,700 lots (daily change -92 lots); Huaxin morning report stated that "the most-traded September contract closed at 428,230, +1,980 yuan from yesterday's close"——The night session opened low and rose, gaining for two consecutive days, with 428,000 shifting from "resistance" to "new pivot".

Inventory:

• LME tin inventory decreased by 130 mt on August 20 (Cailianshe, August 20, 16:03), maintaining an absolute historical low of about 1,715 mt (Tonghuashun data: 1,715 mt on August 20, 1,740 mt on August 21), with deliverable supplies outside China continuing to tighten;
• SHFE tin inventory was about 5,452 mt (increased to 5,452 mt on August 14, with +324 mt from Guangdong warehouse receipts), total exchange tin inventory (LME+SHFE) around 7,200 mt;

Macro: September rate hike probability at a low of 36.2%, with July PCE on August 26 and Warsh at Jackson Hole on August 28 becoming dual anchors for autumn policy

(1) CPI+PPI+retail data three consecutive soft prints, September rate hike probability 36.2%. US July CPI YoY 3.4% (lowest since March), core CPI YoY 2.5%; July PPI YoY 4.7% (prior 5.5%), MoM unchanged; July retail sales MoM -0.6% (largest monthly drop in over a year). CME FedWatch/Nbd.com.cn/East Money/Tencent multi-source consensus (August 21, 06:13): September probability of no change 63.8%, cumulative 25bp hike 36.2%; by October, probability of no change 51.8%, cumulative 25bp 41.4%, cumulative 50bp 6.8%——"Dovish trading" is the core macro backdrop for the continuous rise in tin prices during the night session.

(2) Dual Anchors of Autumn Policies: July PCE on 8/26 + Warsh at Jackson Hole on 8/28. ①July PCE (the Fed's preferred inflation gauge) will be released at 12:30 on Wednesday, August 26 (consensus from TradingEconomics/Oxford Economics/Regards of Wall Street). Oxford Economics estimates headline PCE YoY at 3.6% (vs. 3.7% in June); Cleveland Fed Nowcast/SinoPac estimates core PCE YoY at 3.3%–3.4%; Goldman Sachs estimates core PCE MoM +0.23% (slightly above core CPI +0.22%). Mars Capital/Goldman Sachs cautions that "disinflation progress in July–August PCE may stall, with energy prices pushing up the headline"; if PCE meets or is below expectations → probability of rate hike falls further, tin surges past 430,000; if above expectations → 36.2% pullback, support test at 424,000. ②Warsh's Jackson Hole keynote speech is scheduled for 10:00 a.m. Eastern Time on Friday, August 28 (confirmed by Sina Finance 8/21 04:36/Regards of Wall Street), about 18–19 days before the September 15–16 FOMC meeting. Multiple analysts (Regards of Wall Street/edgeX/Taishin Securities) agree: Since taking office, Warsh has shortened statements, scrapped the dot plot, reduced forward guidance, and tends to "let the market guess"; he said Jackson Hole will focus on "long-term structural issues rather than near-term data" — expectations are that Warsh will not release a clear rate signal this time, but former Philadelphia Fed President Harker and former St. Louis Fed President Bullard warned that "if it stays at the level of statements without substantive explanations on fighting inflation, it will disappoint the market and put the Fed's credibility under pressure", with the 20-minute speech being a "decisive sentence" before September.

(3) Geopolitics and AI Chain: The situation in the Strait of Hormuz remains tense, and international crude oil is rising (WTI +2.16% to $86.21 on 8/20, Brent +1.77% to $93.24); the risk of a second inflation push has not dissipated but is temporarily overshadowed by "easing trades"; Hon Hai Precision Industry's H1 net profit +96%, AI server capex remains high, and tin's "solder α" medium and long-term support remains intact.

Fundamentals: Yinnan mine fully shut + Wa State 50% capped, supply hard constraints remain unrelaxed

(1) Yinnan Mining's mining, processing, and tailings operations are fully shut, with the duration of the halt uncertain. Xingye Silver&Tin announced on 7/31 (announcement No. 2026-62/257/260): a July 26 accident resulted in one death; underground mining operations were halted on July 28, and the processing and tailings systems were halted simultaneously on July 30; as of the announcement date, both the mining system and the processing/tailings system have been shut down. The cause of the accident and the cause of death are still under investigation, and the duration of the shutdown cannot be determined, making it impossible to accurately estimate the impact on current period and full-year performance. For the core tin-silver mine with an annual mining and processing capacity of 1.65 million mt, a short suspension of 1–2 months is estimated to reduce tin metal content by approximately 1,000 mt; if the investigation/rectification extends to Q4, China’s ore supply deficit will further widen.

(2) Wa State’s "50% cap" remains unchanged: the full-year production resumption ceiling is locked at 40%–50% of the pre-mining ban level, with a full resumption postponed to 2027 (as per ITA estimates); the February water pumping fee sharing (5% export levy + original 30% in-kind tax = combined 35%) raised mining costs, and the April Bang Kang explosive factory blast disrupted the explosive supply chain; in July, Myanmar’s monthly tin ore exports to China returned to over 6,000 mt, still only 40%–50% of normal levels.

Spot market

August 20 spot cargo: night session futures rebounded, suppliers raised offers, and downstream releases of rigid demand at low levels.

Premiums: small brand versus September parity to premium 500 yuan/mt, Yunzi brand versus September premium 500–1,000 yuan/mt, and Yunxi versus September premium 1,000–1,500 yuan/mt.

Transactions: "Inventory restocking and weak solder demand limit high-level continuation." On the futures night session, prices opened low at 424,000 and rallied all the way to 429,580, downstream and end-users inquired and priced in the 424,000–426,000 range, with willingness stronger than earlier releases; some solder plants and electronics enterprises completed small-lot transactions; but above 428,000, solder plants generally placed no orders, with weak buying willingness. The entire day was characterized by "night session low-open rally followed by rigid demand release rather than active restocking initiation"—the July solder operating rate of 72.8% (down 6 pct MoM) confirmed that demand from the electronics chain has yet to match futures gains; AI servers and advanced packaging-related high-end solder demand showed resilience but was not enough to boost spot volumes in the short term.

[Data Source Statement: All data other than public information are processed by SMM based on public information, market communication, and SMM’s internal database models. They are for reference only and do not constitute decision-making advice. The information provided is for reference only. This article does not constitute a direct recommendation for investment research decisions. Clients should make cautious decisions and not substitute this for independent judgment. Any decisions made by clients are unrelated to SMM.]