SHANGHAI, Jun. 30 (SMM) –In Shanghai spot tin market, mainstream traded prices followed SHFE tin down further to RMB 112,500-113,500/mt on June 29. Downstream consumption was sluggish as bearishness dominated. Goods from Yunnan Tin Group traded at RMB 113,000-113,500/mt.
SMM surveyed market players in domestic tin industry.
45% of them expect tin prices to hold stable this week: Myanmar has entered the rainy season, which will last three months. Tin ore supply in the country is not expected to recover until mid-to-late August. LME tin inventories fell to 6,810 mt as of last Friday, the lowest in over six years. The decline in LME tin inventories was due mainly to falling shipment from Indonesia. The Indonesian government stipulates that local tin producers are not allowed to export unless they can prove that tin they produce comes from government-registered mining sites, effective August 1 . So, LME tin should hold stable this week. Some SME tin producers in China have cut output, due to raw material shortages, environmental issue and depressed market conditions. As such, tin prices in domestic spot market should stop falling.
The rest 55% are bearish: the Greek debt crisis will continue to cast a shadow on the market. LME tin might fall to test support at USD 14,300/mt. Daily trading volumes of SHFE tin were a mere over 1,000 mt, due to a lack of capital. SHFE 1509 tin contract, the most active one, hit a new low of RMB 110,720/mt on Monday. The slump in China’s stock market and weak LME tin should send SHFE 1509 tin contract down further. Weak SHFE tin, coupled with the traditional off-season, will cause tin prices in domestic spot market to drop further to RMB 111,000/mt.