Why Did Tin Prices Rebound after Plunging?

SHANGHAI, Mar 16 (SMM) – The tin prices fell rapidly from a high level to 320,000 yuan/mt and then rebounded recently. According to SMM analysis, there are two major reasons for the price rally.

1. The upstream enterprises held firm to the prices. The previously surging tin prices drove up the tin ore prices, bringing higher costs to the smelters. Then the plunging tin prices caused the smelters to suffer losses. Hence the smelters held back cargoes, and the market supply tightened.
2. The domestic demand for tin kept growing after the Chinese New Year. The downstream enterprises gradually resumed the production amid increasing orders. Despite the recent control measures for the COVID-19 pandemic, most domestic solder companies are likely to raise their operating rates in March. As such, the procurements of tin increased significantly following the price decline.

In the near term, the pandemic in Myanmar will continue to hinder China’s imports of tin ore, and the domestic pandemic will also affect the production. Hence the supply and demand of tin will weaken simultaneously. At the same time, the downstream users will mostly refuse the price increase, which will suppress the transactions markedly. Therefore, the tin prices will be affected by the spot quotations, and are expected to be rangebound between 330,000-334,000 yuan/mt.