SHFE Tin Followed the Sector's Rise, Ore Supply Remains Tight [SHFE Market Closing Review on March 26]

Due to tariff uncertainties and the US consumer confidence index declining for the fourth consecutive month in March, the US dollar index weakened, and copper prices surged significantly during the night session, driving a collective rise in non-ferrous metals. SHFE tin once rose nearly 3%. Today, market sentiment cooled during the day session, and SHFE tin fluctuated and pulled back, narrowing its gains. As of the close, the SN2505 contract rose 1.29%, closing at 278,140 yuan/mt.

The resumption of tin mining in Myanmar is progressing in an orderly manner, but it is expected to take at least two months to fully restore normal mining. Coupled with the shutdown of the Bisie mine, the short-term supply gap of tin ore is difficult to fill. China's tin ore imports remained low in the first two months, and domestic tin ore supply remains tight, making it difficult for smelters' operating rates to rebound to pre-holiday levels. According to SMM's in-depth market survey data on processing, as of last Friday, the operating rates of refined tin smelters in Yunnan and Jiangxi, two major tin-producing provinces, dropped back slightly, with a combined operating rate of 61.5%.

The flow of tin ore in Yunnan is at a historically low level, and inventories across all links are relatively tight, exacerbating the structural imbalance in raw materials. The operating rates of refined tin smelters in Yunnan may continue to decline. In Jiangxi, scrap supply constraints remain significant, and its operating rate remains stable but still at a low level. Recently, orders from downstream and end-user companies have fallen short of expectations, and the recycling volume of tin scrap has been less sufficient than in 2024, making it difficult for the operating rates of recycled tin smelters to rebound.

Regarding the market outlook, Jinrui Futures commented that the tight supply of tin ore continues to intensify, and domestic raw material supply may remain tight before Myanmar resumes production. Processing fees maintain a downward trend, and future smelting production faces increasing resistance. On the consumption side, recent price fluctuations have significantly weakened downstream procurement. Looking at short-term prices, considering the tight raw material supply and the strong short-term prices weakening downstream, tin prices are expected to remain high and stagnant.