[SMM Analysis] Analysis and Trend Outlook of China's Refined Tin Industry Operations in February 2024

Analysis and Trend Outlook of China's Refined Tin Industry in February 2024

According to data processed by SMM based on market exchanges, China's refined tin production in February 2024 decreased by 7.36% MoM but achieved a significant YoY growth of 11.14%. Affected by the tightening supply of tin ore and scrap, coupled with the Chinese New Year holiday, the overall domestic tin ingot output in February continued its downward trend. This data exhibits notable structural characteristics, reflecting threefold pressures and structural opportunities faced by the industry: first, the persistent tightening of the tin concentrate supply chain imposes rigid constraints on capacity; second, the cyclical production adjustments triggered by the traditional Chinese New Year holiday; third, the industry demonstrates resilience in capacity despite raw material constraints.
(1) Yunnan Production Area:
As the core region for tin smelting in China, Yunnan experienced a decline in capacity utilisation rate in February. The fundamental constraint stems from pressure on the raw material side: Myanmar ore imports have remained below the critical threshold of 30,000 mt for six consecutive months. Currently, smelters in this region face a continuous decline in TC for concentrates to historical lows, directly leading to reduced overall production enthusiasm among smelters.

(2) Jiangxi Production Area:
The primary impact comes from the characteristics of the raw material structure. The seasonal stagnation of the scrap recycling system during winter has widened the raw material gap. Although the resumption rate improved after the Lantern Festival, the shortened raw material inventory cycle has caused significant delays in capacity recovery.

(3) Dynamics in Other Regions:
Inner Mongolia maintained stable operations, benefiting from the unique advantage of captive mines. In contrast, emerging production areas in Anhui and surrounding regions saw a sharp 28-percentage-point drop in capacity utilisation rate due to delays in imported ore arrivals and rising costs of scrap sorting, highlighting the insufficient risk resistance of peripheral regions.

Based on SMM calculations, refined tin production in March is expected to increase by approximately 15% MoM. Driving factors include the elimination of disruptions caused by the Chinese New Year, leading to the restoration of full production days, and improved scrap tin supply.