SHFE Tin Jumped Initially and Then Pulled Back, Mine Supply Remains Tight [March 31 SHFE Market Closing Commentary]

Last Friday, a sudden earthquake in Myanmar sparked concerns about the timely recovery of local tin ore supply. SHFE tin surged significantly at the beginning of the night session, once rising more than 3%, and then hovered at highs. Today, the center of tin prices shifted downward. As of the close, the most-traded contract's gain narrowed to 0.41%, closing at 282,350 yuan/mt.

The 7.9-magnitude earthquake that occurred in Myanmar on March 28, 2025, had its epicenter located 16 km northwest of Sagaing, the capital of Sagaing Region in central Myanmar. The main tin-producing area of Wa State is located in northeastern Myanmar, bordering Yunnan Province, China, and is estimated to be approximately 300-450 km from the epicenter. Wa State is relatively far from the epicenter, so the direct impact of the earthquake on local supply may be relatively small, potentially mainly affecting tin ore transportation and the expected resumption of production in Wa State. The Ava Bridge leading to the Ruili port has collapsed, but the Meng'a port, currently the main port for transporting tin ore, has not yet been reported to be affected. The impact of the earthquake cannot be quantified at this time and remains to be continuously tracked. The tin mine in the DRC has ceased production, and the resumption time is uncertain, making it difficult to change the tightening trend of tin ore supply.

The operating rates of refined tin smelters in Yunnan and Jiangxi have started to pull back. According to SMM's processing data from in-depth market surveys, as of last Friday, the operating rates of refined tin smelters in these two important tin-producing provinces have declined to some extent, with a combined operating rate of 57.37%. Constrained by tight raw material supply, the overall supply-demand pattern remains tight. On the demand side, downstream solder companies mainly make just-in-time procurement, with high prices suppressing restocking intentions. Downstream inquiries and orders are relatively quiet, and sentiment is clearly cautious. However, the "trade-in" policy and high production schedules for home appliances provide potential support for demand.

Regarding the future market, Jinrui Futures commented that the major earthquake in Myanmar last week has lowered market expectations for supply recovery. Recent domestic and overseas tin ore supply disruptions remain frequent, and domestic raw material supply may continue to be tight before the disruptions are resolved. Processing fees continue to decline, increasing future smelting production resistance. On the consumption side, recent price fluctuations have significantly weakened downstream procurement. Looking ahead, considering tight raw material supply and the short-term price strength weakening downstream, tin prices are expected to remain stuck at highs.