Last week, SHFE tin prices showed a trend of "rising first and then falling," with the US Fed maintaining interest rates unchanged for the third consecutive time. [SMM Tin Morning Meeting Summary]

SMM Tin Morning Meeting Summary on May 12, 2025

Last week, SHFE tin prices followed a "rally first, then retreat" pattern. Early in the week, restocking demand was released, and restocking sentiment briefly heated up after the holiday, with the most-traded SHFE tin contract (SN2506) fluctuating around 260,000 yuan/mt. Midweek, prices jumped initially and then pulled back. Boosted by expectations of RRR cuts and interest rate cuts by the PBOC and Sino-US economic and trade talks, SHFE tin prices surged to 262,000 yuan/mt in the morning session, but pulled back in the afternoon due to uncertainties surrounding US tariff policies and a stronger US dollar, closing at 261,480 yuan/mt, down 0.16%. Macro pressures: The US Q1 GDP contracted 0.3% QoQ, while core PCE inflation rose to 3.5%, intensifying market concerns about economic downturn. The US dollar index fluctuated at highs, weighing on the non-ferrous metals sector. By the end of the week, prices fluctuated downward. The most-traded SHFE tin contract opened lower and continued to decline, closing at 259,980 yuan/mt at midday, down 0.26% intraday.

On the international macro front, the US Q1 GDP contracted 0.3% QoQ, core PCE inflation rose to 3.5%, consumer confidence fell to a record low, and the manufacturing PMI dropped to 48.7, indicating intensifying downward pressure on the economy. The US Fed kept interest rates unchanged for the third consecutive time, emphasizing in its statement the rising risks of inflation and unemployment. The US dollar index fluctuated at highs, suppressing the overall valuation of the non-ferrous metals sector. Domestically, the overall supply of tin ore remained constrained by the slow pace of production resumptions in Myanmar's Wa region and the phased resumption of production at the Bisie tin mine in the DRC, with only marginal easing of the short-term ore supply tightness. The operating rates of refined tin smelters in Yunnan and Jiangxi remained at low levels, with a combined operating rate of 57.16%. Processing fees were at historical lows, putting pressure on smelting profits. On the demand side, some downstream processing enterprises gradually resumed operations after the Labour Day holiday, and restocking demand at lower prices was released to some extent, but high-price transactions remained sluggish. Solder enterprises had stable orders but no significant increase, and the US's electronic tariff policy on China dampened downstream restocking expectations. Overall, given the numerous uncertainties in both domestic and overseas markets, tin prices are expected to maintain a fluctuating trend this week. Investors are advised to closely monitor the progress of Sino-US economic and trade talks, the US dollar's movement, and changes in domestic policies, and to operate cautiously.