Sept. 5 (ITRI) -- China refined tin imports declined to 721 tonnes in July, down by 47% m-o-m according to the data from China Custom. Although the China domestic price was higher than LME price in July, it was not profitable to import tin for general trade which has to pay 3% import duty and 17% VAT. Furthermore the great volatility of LME prices made business risky because traders cannot hedge purchases in China market. This also impacted tin concentrate import. China only imported 171 tonnes tin concentrate in July, much lower than in June. We believe this weakness is temporary and expect imports to rebound again in August, since the domestic price premium over the LME has arrived at a record high makes importing very profitable currently, even for general trade.
According to official customs data China didn’t export any refined tin in July. 973 tonnes refined tin was exported from January to July. But from incomplete import data of third countries we have identified that China exported around 16,000 tonnes of tin metal from last October to this May. We believe now that China destocking cycle has ended. There is neither the price incentive nor the excess material left – the mild deficit in the Chinese market this year means import levels are likely to rise in the rest of this year.
China’s refined tin production decreased by 8% m-o-m in July to 12,096 tonnes, according to the China Nonferrous Metals Industry Association (CNIA). But cumulative production still increased by 6.9% y-o-y in January-July. The biggest increases were from Hunan and Guangxi province. Meanwhile China’s tin-in-concentrate production rose by 17% y-o-y in January-July to 53,031 tonnes.