Last week, SHFE tin prices fluctuated considerably before maintaining high levels. The overall tin market showed a pattern of weak supply and demand. [SMM Tin Morning Meeting Summary]

SMM Tin Morning Meeting Summary on May 19, 2025

SHFE Tin Price Trend Last Week: Fluctuated considerably before holding at highs. Prices jumped initially and then pulled back at the start of the week, buoyed by positive expectations for the China-US economic and trade negotiations. However, prices subsequently pulled back after hitting highs and fluctuated around 260,000 yuan/mt due to weak US economic data (GDP contraction on a QoQ basis, elevated PCE inflation) and a stronger US dollar. During the night session on May 13, SHFE tin closed at 264,570 yuan/mt, up 1.33%, with market sentiment briefly supported by favourable macro front. Prices fluctuated upward mid-week, primarily driven by easing market concerns as US April inflation cooled, coupled with expectations of tighter ore supply. On May 15, prices held at highs, with the most-traded contract closing at 265,210 yuan/mt, down 0.21%, while spot quotes rose to 266,750 yuan/mt, reflecting smelters' refusal to budge on prices. Prices adjusted within a narrow range over the weekend, maintaining an overall pattern of high-level fluctuations, but were significantly capped by the 60-day moving average (approximately 265,000 yuan). Spot Market Trading Activity: High prices suppressed demand, with trading gradually slowing down. Early in the week: Smelters held firm on prices and were reluctant to sell, while traders actively traded at fixed prices. Some downstream players restocked at lower prices, with transactions concentrated in the 259,000-263,000 yuan/mt range. Mid-week to weekend: As prices rose, downstream players became more cautious, maintaining just-in-time procurement only. Trading volumes contracted to the 264,000-266,000 yuan/mt range, with market activity becoming increasingly sluggish.

Last week, the domestic and overseas tin markets collectively exhibited a pattern of weak supply and demand, with tin prices fluctuating rangebound under the influence of macro sentiment and fundamental factors. In terms of supply, refined tin production in May is expected to decline MoM, but the spot tin market will continue to face inventory tightness in the short term. The Bisie tin mine in the Democratic Republic of the Congo resumed production in phases, with the first batch of tin concentrates shipped on May 9. However, it is not expected to enter the smelting process until June, making it difficult to alleviate the supply tightness in the short term. On the demand side, no significant improvement has been observed. High tin ingot prices have led to sluggish restocking intentions in the electronics/home appliance industries, causing blockages in industry chain transmission and further reducing scrap circulation. The operating rates of refined tin smelters in Yunnan and Jiangxi provinces remained low, with a combined operating rate of 56.85%. Processing fees were at historical lows, putting pressure on smelting profits. On the international macro front, the US GDP contracted by 0.3% QoQ in Q1, with core PCE inflation rising to 3.5%, consumer confidence falling to historical lows, and the manufacturing PMI dropping to 48.7, indicating increased downward pressure on the economy. The US Fed kept interest rates unchanged for the third consecutive time, emphasizing in its statement the heightened risks of inflation and rising unemployment. The US dollar index fluctuated at highs, suppressing the overall valuation of the non-ferrous metals sector. Looking ahead, it is expected that tin prices will continue to fluctuate rangebound in the absence of significant macro favourable or unfavourable developments. Investors are advised to closely monitor the progress of China-US economic and trade talks, US dollar trends, and domestic policy changes, and to operate cautiously.