Short-term speculative funds surged, driving SHFE tin to soar over 4%. The market remains vigilant against the risk of a "false breakout." [SMM Tin Futures Brief]

April 2, 2025, Daily Commentary on the Most-Traded SHFE Tin Futures Contract

On April 2, 2025, the most-traded SHFE tin contract (SN2505) continued its strong upward trend, surging over 4% during the session, reaching a high of 299,990 yuan/mt, approaching the 300,000 integer mark and setting a new yearly high. In the afternoon, the price pulled back slightly, eventually closing at 297,590 yuan/mt, with a daily increase of 3.89%. During the night session, SHFE tin prices fluctuated at high levels, closing at 289,000 yuan/mt, with market activity remaining high and open interest surpassing one million lots.

The earthquake in Myanmar has heightened uncertainty regarding resumption of production: At the end of March, a major earthquake occurred in Myanmar, and the resumption symposium for the Manxiang mining area, originally scheduled for April 1, was postponed. Market expectations for the recovery of tin ore supply have further weakened. Although the mining area was not directly damaged, risks to transportation channels and policies have increased, compounded by the shutdown of the largest tin mine in the DRC, highlighting the "bottleneck" issue in the global supply chain.

Low overseas inventories have fueled expectations of a squeeze: LME tin inventories remain at low levels, with the 0-3 month premium expanding to $264/mt, and the sentiment of tight overseas supply has spread to the domestic market. Short-term speculative funds have driven SHFE tin open interest to surpass previous highs, with the market remaining cautious about the risk of a "false breakout," but macro-level expectations for US Fed interest rate cuts and geopolitical conflicts provide support for metal prices.

Technical analysis: After breaking through the 290,000 mark, the most-traded SHFE tin contract needs to verify its validity, with resistance at the historical high of 300,000 and support at 287,000 (5-day moving average).

The current SHFE tin market exhibits a "strong expectations, weak reality" characteristic: supply-side narratives dominate short-term sentiment, but the inhibitory effect of high prices on consumption is gradually becoming apparent. Investors need to be wary of increased volatility risks from capital games and closely monitor the progress of Myanmar's resumption policies and signals of recovery in downstream orders.Outlook and Risk Warnings