SMM Morning Review - 2011/1/25 Tin Market

SHANGHAI, Jan. 25 (SMM) -- LME tin prices opened at USD 27,700/mt and ended at USD 28,000/mt overnight, up by USD 350/mt from a day earlier, with the highest price at USD 28,190/mt and the lowest price at USD 2,750/mt. Daily trading volumes were 382 lots and positions were 20,500 lots. LME tin inventories were up by 110 mt to 17,405 mt. Cancelled warrants were 980 mt, accounting for 5.63% of total inventories.

LME base metal prices closed mixed on Monday. LME tin prices extended upward momentum and successfully broke through USD 28,000/mt, setting a new high during the European trading hours. Gains in some metals were mainly attributed to decline of the US dollar from eased concern of European debt crisis.

Composite PMI in the euro zone during January climbed to 55.2, higher than estimation of 54.3. PMI from manufacturing sector was 56.9, and previous estimation was 57. It is reported that Germany’s PMI was the highest among other European member countries. The improved economic data from the euro zone also lent support for LME tin price hike.

Market concern over further tightening policy from China as well as China’s control economic growth pace still haunted market, which will curb robust upward momentum of prices. From fundamental point of view, supply of tin slipped in the market due to cold weather in northern hemisphere, as tin transportation and storage have certain requirement on temperature. In this context, tin prices were pushed higher due to lower supply. At present, LME tin prices have broke through USD 28,000/mt, and may further extend upward momentum, with support around USD 27,000/mt at present.

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