SMM2 March 22: tin is the most precious thing. Looking back at the trend of tin in recent years, it can be said that you have a clear view of the dwarf mountains around you. Today, Lunxi broke through the high again, hitting an intraday high of US $44525 a tonne, up 0.56 per cent as of around 15:55. Why is the price of tin so high, as it is called? Is it "rare"?
"View SMM tin data Kanban
Spot market
According to SMM research, the number of quotation merchants in the market remained at a high level in early trading, but according to the feedback of merchants, the overall shipping performance of the market today was poor, and only a few merchants performed well after the price fell. The rapid rise and fall of prices in early trading has intensified the wait-and-see attitude of downstream demand, and the market willingness to purchase is still similar to yesterday's low order waiting for a deal. In today's market, the quotations of non-deliverable brands have been flat or even slightly discounted, and there are also discounted quotations for imported long-term arrival products.
The average spot price of SMM1# tin was unchanged from yesterday at 339750 yuan / tonne, reaching its lowest level since February 22, 2019 on March 23, 2020, and up 190 per cent as of today compared with March 23, 2020.
"View the spot Historical Price of SMM Nickel products
Institutional point of view
International Tin Association: ITA conducts research on global tin smelters to compile an annual list of the world's largest producers. The top 10 companies produced 59 per cent of the world's tin in 2021, down from 67 per cent in 2020. As mentioned earlier, the decline in the total output of the top ten producers can be attributed in part to the reduction in MSC production. At the same time, the decline in Tianma production for the second year in a row is also one of the reasons.
Viewpoint: as expected, world refined tin production has recovered rapidly from the epidemic, exceeding the levels of 2019 and 2020. ITA does not expect more problems caused by outbreaks in the future and expects production to continue to grow in 2022, with global production rising by about 4 per cent.
Wenhua Finance and Economics: in 2021, the global output of tin mining mountains will be 300000 tons, an increase of 14% compared with 264000 tons in 2020. This is the preliminary data released by the US Geological Survey (USGS), which also said that the average annual price of LME refined tin is expected to be 1500 cents per pound in 2021, up 93 per cent from 2020.
USGS added that transport bottlenecks, the reintroduction of COVID-19 blockade restrictions and rising demand for electronics and consumer goods led to supply constraints, which were the main reasons for the nearly doubling of refined tin prices in 2021.
Guotai Junan: tin fundamentals are still in a pattern of weak supply and demand, and futures stocks at home and abroad have increased, but the price trend is still strong, indicating that the market is still confident about the trend of tin prices in the future.
Guotai Junan believes that there is still an opportunity for tin prices to continue to move upward in the future, and we need to pay attention to whether the recovery of overseas smelting can decisively reverse the tin supply pattern.
Global tin production
Summary
SMM believes that on the supply side, in addition to the strong willingness of individual smelters to raise prices, the price gap of mainstream smelters is still maintained at a small level. On the demand side, the downstream demand has initially recovered, and the situation of centralized purchase orders is prominent in the market while prices fall back to the low level. In the spot market, the decline in prices has led to a pick-up in market shipments, the supply of goods quoted in the market is more sufficient, and rising water continues to remain at a low level in the near future. To sum up, with the gradual resumption of production at the smelter this week and the simultaneous warming of supply and demand to maintain the balance in the short term, SMM expects the tin price trend to remain high.
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