Rate Cuts Combined with Tightening Supply May Keep Tin Prices on an Upward Trend [SMM Tin Morning Meeting Summary]

The US Federal Reserve concluded its monetary policy meeting last week and made a significant decision: lowering the federal funds rate target range to 4.75% to 5%, which means the Fed cut rates by 50 basis points, marking the first rate cut since 2020. It is worth noting that, based on historical data, the Fed usually does not take such a large rate cut when starting a new rate-cutting cycle. This larger-than-expected rate cut might be to address the potential risk of an economic "stall" and achieve a smooth "soft landing" for the economy. This decision will undoubtedly have a profound and lasting impact on the global commodity market. Focusing on the domestic market, China's tin ore imports showed a significant decline in August. This was mainly due to reduced tin ore imports from key suppliers such as Myanmar, the Democratic Republic of Congo, and Australia, while imports from other countries remained relatively stable. Specifically, tin ore imports from Myanmar in August were only 2,800 mt (metal content approximately 1,387 mt), down from July 2024. Currently, the Wa State authorities in Myanmar have not clarified the timetable for the resumption of tin ore production, but according to market analysis and forecasts, Myanmar's tin ore imports may remain at low levels until the end of the year. Meanwhile, tin ore imports from the Democratic Republic of Congo and Australia also failed to maintain the scale of the previous month. Overall, the reduction in tin ore supply due to Myanmar's mining ban has had a substantial impact on domestic smelters. In summary, the Fed's rate cut decision is having a lasting impact on SHFE tin prices, and the gradual tightening of domestic tin ore supply may further push up SHFE tin prices.