SMM Tin Market Morning Review (2013-4-9)

SHANGHAI, Apr. 9 (SMM) - LME tin market overnight opened at USD 22,875/mt, with the highest and lowest level of USD 23,038/mt and USD 22,850/mt, respectively. Finally, LME tin market closed at USD 22,950/mt, up USD 67/mt from a day earlier. Trading volumes were 226 lots, down 62 lots. Positions were 20,971 lots, down 38 lots. Inventories were up 15 mt to 14,415 mt.

LME tin market overnight lurched higher, reaching up to USD 23,038/mt, but felt downward pressures at the tail of trading, and finally closed at USD 22, 950/mt, up USD 67/mt from a day earlier. The weaker-than-expected US non-farm payrolls reading added to market concerns over market outlook for metals demand. But, the rising euro against the dollar and strike at Chile’s copper mine helped support market prices. 

The poor US employment data overnight give limited effects on the market. Euro zone April Sentix investor confidence index was -17.3, which was below expectations, but Germany's February industrial production rose from 0 in the previous month, to 0.5%. The euro against the US dollar has been rising for the fourth straight trading day and broke through 1.30, and Chilean state miner Codelco's unionized workers conducting a work stoppage on Monday increased expectations of copper supply shortfalls in the near term, so financial and commodity markets soared across the board.

In China, the Shanghai Composite Index plummeted due to the bird flu effects and tightening regulations to accumulation fund loans. Besides, the direct exchange between AUD and RMB will start on April 10th, so that AUD can be exchanged directly with RMB aside from the US dollar and JPY. That will help reduce losses of Chinese enterprises importing Australian ore.

In other markets, the US dollar index was 82.65, up 0.1. The US and European equities markets, as well as LME metals market all advanced.  

On Tuesday, a slew of major economic data will be released, including China’s March CPI and the UK’s February manufacturing and industrial production data. The resistance at the USD 23,000/mt mark remains strong, and LME tin market is expected to come under downward pressures. With steady movements in LME tin market and no availability of goods in the domestic tin market, SMM expects domestic spot tin prices will hold between RMB 149,000-152,000/mt on Tuesday.