DRC Situation Highly Uncertain, Tin Prices Consolidate at High Levels [Institutional Commentary]

On Thursday, the most-traded SHFE tin 2504 contract fluctuated upward during the day and at night, while LME tin fluctuated. Spot market: It was heard that small brands were at a discount of 600-200 yuan/mt to April, Yunnan brands were at a discount of 200-premium of 100 yuan/mt to April, and Yunxi was at a premium of 100-400 yuan/mt to April. Customs: In February, domestic tin ore imports were 8,000 mt (equivalent to about 3,562 mt (metal content)), down 11.15% MoM and 48.34% YoY, an increase of 1,303 mt (metal content) from January. Cumulative imports for January-February were 158,000 mt, down 31.20% YoY. In December, domestic tin ingot imports were 2,991 mt, down 15.00% MoM and 39.62% YoY. Cumulative imports for January-December were 21,804 mt, down 38.23% YoY.

The DRC military confirmed on March 20 that the rebel group "M23 Movement" had captured the mining town of Walikale in North Kivu Province in the eastern part of the country. The area around Walikale is rich in mineral resources, particularly tin ore.

Overall, the DRC has expressed its willingness to reach a minerals-for-security deal with the US. However, as the M23 advances continue, there remains significant uncertainty regarding local tin ore supply. Before the situation becomes clearer, market sentiment remains cautious, with open interest and trading volume of the most-traded SHFE tin contract pulling back. It is expected that prices will remain in a high-level consolidation in the short term.