Affected by the capital side, tin futures prices once rose by more than 3% [SMM Comment]

Affected by the capital side, SHFE tin contract surged today, once rising by more than 3.00%, and closed up by 2.39% by midday. LME tin prices showed a similar trend, rising by 3.18% before weakening, and increased by 2.09% as of 12:03.

Spot Prices

Recently, SMM 1# tin spot average price has fluctuated, reaching 65,000 yuan/mt today, up 2.39% from the previous day. The SMM survey showed that downstream enterprises took a wait-and-see stance amid high prices, with most trading companies reporting sporadic transactions or no transactions at all.

Supply Side

Imports: In April, China's tin ore imports were 10,200 mt, down 55.44% MoM and 44.86% YoY. The metal content stood at about 4,778 mt, a decrease of 1,419 mt MoM. The imports in January-April totalled 70,600 mt, down 4.7% YoY. The sharp drop in April imports was mainly due to a significant reduction from Myanmar and Russia. Although imports from other countries continued to grow steadily, they could not fully compensate for this gap. The Wa State authorities in Myanmar have not yet indicated when local tin mines will resume production, continuously lowering market expectations for the resumption of work and production in Wa State. It is also understood that the inventory in Wa State is critically low, making it unlikely to increase tin ore exports to China in the future. Tin ore imports from countries other than Myanmar increased, driven by significant growth in imports from Laos and Nigeria, while imports from other countries mostly remained stable, with a slight increase expected in the future.

Domestic: Last week, Yunnan province underwent environmental inspections, causing some refined tin smelters to shut down for maintenance, with an unclear time for production resumption. These factors combined led to tighter supply expectations in the tin market.

Inventory

Domestic: Since May, the total tin ingot inventory in Shanghai, Jiangsu and Guangdong has continued to increase, reaching about 19,400 mt on May 24, an increase of 685 mt WoW. Last week (May 20-May 24), overall transactions in the spot market were relatively sluggish, while the supply of small-brand tin ingots in the spot market was relatively tight.

LME Inventory: LME tin inventory has been relatively stable recently, reaching 4,945 mt on May 24, an increase of 10 mt WoW.

Demand Side

In May, production of downstream and end-user enterprises held stable, with order volumes expected to remain at the same level MoM. Since the beginning of the year, the demand side has maintained a relatively stable trend.

SMM Outlook

Overall, affected by tighter supply expectations and stable demand, SHFE tin prices may be more prone to rise than fall in the short term.