Demand under pressure, annual line fluctuates [[Institution's] Comment]

Upstream Supply: In March, China's imports of tin concentrates in mt continued to show a significant YoY decline. The weekly operating rate for refined tin production in Yunnan and Jiangxi provinces, as reported by SMM, remained weak. It is widely anticipated that tin output will decrease to 14,000 mt in April. Currently, processing fees for ore remain low, and enterprises are continuously depleting their raw material inventories. However, with the overseas market underperforming the domestic market, the refined tin import window has opened, and net imports of refined tin may continue in April. Customs data indicates that China's cumulative net imports of refined tin in Q1 reached 119 mt, with a shift to net imports in March alone. The Wa State is advancing meetings on production resumptions, and the fee standards for mines and beneficiation plants have been raised, particularly increasing production costs for low-altitude mines and small-to-medium-sized beneficiation plants. The new regulations may drive the development of resources in the Manxiang mining area towards large-scale and intensive operations.

Downstream Consumption: The global semiconductor consumption index has generally turned around, although TSMC's revenue and the export situation of Japanese semiconductor equipment remain relatively favorable, possibly related to the geographical relocation of high-end semiconductor production capacity. LME tin inventory has slowly decreased to 2,810 mt, with LME tin spot discounts at US$166 for 0-3 month futures. Objectively, LME tin inventory is low but not extremely so. Domestic SMM social inventory decreased by only 72 mt last week, remaining at 10,413 mt. The market is not optimistic about tin-related stockpiling before May Day. Preliminary export data for South Korea in April has been revised down by 5%, while domestic PV production scheduling faces significant downward pressure starting in May. The production scheduling uncertainty for home appliances, which had been highly prosperous earlier, is also relatively high.

Outlook: Overseas tin pricing is weaker. Although domestic tin output is tight, attention should be paid to import supplementation. The medium and long-term trend will be under pressure due to the actual transition of concentrate supply from tight to loose and consumption concerns. SHFE tin is expected to rebound with short positions, and short positions should be held against a range of 265,000-270,000 mt.

(Source: SDIC Futures)