BNP Paribas still expects Tin prices to hit $25,000 a ton level in 2014

UNITED STATES October 17 2013 10:38 AM
 
NEW YORK (Scrap Register): Tin prices to shoot up from recent lows to reach $25,000 a metric ton level next year, said BNP Paribas in a research note.

“Tin demand may have bottomed but growth will be limited. Meanwhile, production growth also will be limited in 2013-14 and supply is being further contained by “onerous” Indonesian policy, he explains. Key producer Indonesia now requires tin from the country to trade on an Indonesian exchange before being exported, said Stephen Briggs, Senior metals strategist at BNP Paribas.

“Trading has picked up since summer but remains far short of what is needed for exports to return to normal. We expect exports to remain sub-par for some time,” Briggs added.

Even assuming Indonesian producers are not forced to cut back radically. BNP Paribas looks for global mine and refined tin production to recover only slightly from 2013 from the slump of 2012. The bank sees a supply shortfall this year of 4,000 metric tons, with the risks skewed towards a larger deficit due to the situation in Indonesia.

“We still expect tin to top USD 25,000/t in 2014, and this may come earlier if Indonesian exports do not pick up soon,” Briggs concluded.