SMM Morning Review - 2011/2/16 Tin Market

SHANGHAI, Feb. 16 (SMM) -- LME tin prices opened at USD 32,300/mt and closed at USD 32,365/mt overnight, down by USD 44/mt from a day earlier, with the highest price at USD 32,799/mt and the lowest price at USD 32,200/mt. Daily trading volumes were 365 lots and positions were 21,122 lots. LME nickel inventories were down by 25 mt, to 17,570 mt. Cancelled warrants were 885 mt, accounting for 5.04% of total inventories.

LME base metal prices closed with losses across the board, and LME tin prices slipped slightly, as China’s inflation data dampened expectation of base metal demand in the short term and triggered concern over further tightening measures from China. LME tin prices were up by a total of 22% since early 2011.

According to data from China’s National Bureau of Statistics (NBS), China’s CPI for January was up by 4.9% YoY, and PPI for January was up by 6.6%. According to data from National Statistics of the UK released on Tuesday, CPI for January was up by 0.1% MoM and up by 4.0% YoY, the highest growth since November 2008, far higher than target ceiling of 2%, exacerbating inflationary pressure. Data from China and the UK further intensified concern over possible interest rate hike which is expected to dampen demand for industrial base metals.

Although overall upward trend of LME nickel prices was still intact, a technical correction is needed in the short term after recent surge. LME tin prices may be extremely sensitive towards any news that indicates economic slowdown. Government plan to adopt tightening measure to curb inflation may also signals economic slowdown. LME tin prices currently receive support at USD 30,000/mt and points to USD 33,000/mt, with long-term bullish trend unchanged.

Copyright © SMM. All Rights Reserved

None of this material may be used for any commercial or public use in any forms or means, without the prior written consent of SMM. For reproduction issue, please contact us by email: service.en@smm.cn