LME Tin Rises Strongly During Holiday, Tightening Indonesian Supply Boosts Tin Price [SMM Tin Morning News]

SMM Tin Morning Brief on October 9, 2025:

Futures: During the National Day holiday, LME tin prices generally showed an upward trend. As of October 7, LME tin closed at $36,370/mt, with a cumulative increase of 2.71% during the holiday. Prices surged significantly at the beginning of the holiday, stimulated by news of tightening supply in Indonesia, hitting a high of $37,695/mt on October 3, the highest level since early April. Although market sentiment was gradually digested later, and prices pulled back slightly from the highs, the overall trend remained strong.

Macro: (1) On October 6, 2025, thousands of artisanal miners gathered at the headquarters of PT Timah Tbk in Bangka Belitung Province, Indonesia, proposing adjustments to the tin trade system. In response, PT Timah announced key adjustments on the same day: raising the purchase price of SN70-grade tin sand (containing 70% tin) from 180,000 to 200,000 Indonesian rupiah per kg to 300,000 Indonesian rupiah; and eliminating intermediary partners, switching to direct payments to miners to resolve previous payment delays of several weeks. These adjustments came at a critical time when Indonesia is comprehensively rectifying the tin industry. Indonesian President Prabowo recently ordered the closure of multiple illegal mining sites in Bangka Belitung Province and the blocking of smuggling channels. PT Timah's measures align with the government's governance direction, aiming to guide resources into formal trade channels by ensuring the income of legal miners. West Bangka Regent Markus welcomed this decision, and Bangka Belitung Islands Provincial Governor Hidayat Arsani emphasized that the price meets the community's expectations. (2) According to The Wall Street Journal, OpenAI and chip design company AMD (AMD.O) announced a multi-billion dollar partnership to jointly develop artificial intelligence data centers that will run on AMD processors. Under the agreement, OpenAI committed to purchasing AMD chips equivalent to 6 gigawatts of computing power, starting with next year's MI450 chips. OpenAI will purchase the chips directly or through its cloud computing partners. (3) According to The Wall Street Journal, a multi-billion dollar deal for Nvidia (NVDA.O) to export artificial intelligence chips to the UAE has stalled nearly five months after it was signed. According to informed sources, the delay is a setback for Jensen Huang and White House AI Director David Sacks, who had hoped to advance the agreement quickly to demonstrate the US's new export-oriented technology strategy. Under the deal announced in May, the UAE committed to investing in the US in exchange for up to tens of thousands of Nvidia chips annually. However, after months of negotiations, the investment has not materialized, puzzling some government officials who are unaware of the reason for the delay. The prospects of this agreement primarily depend on the decisions of US Commerce Secretary Rutenik, who initially strongly advocated for it. The approval of the Commerce Department is crucial for the implementation of the agreement. Informed sources revealed that Huang Renxun and several Nvidia executives have privately complained to other government officials about Rutenik's strategy and the slow progress. Government officials, including Sachs, have also expressed dissatisfaction. A senior government official argued that Rutenik has not obstructed the agreement, but other officials accused him of slowing down the process.

Fundamentals: (1) Supply-side disruptions: Overall tin ore supply is tightening in major production areas such as Yunnan. Some smelters remained under maintenance shutdowns in October (Bullish ★). (2) Demand side: Downstream procurement remains cautious, with high prices significantly suppressing actual consumption. Limited boost from emerging sectors: Although the increase in AI computing power and the growth in PV installations have driven some tin consumption, their current contribution remains small and insufficient to offset the decline in consumption from traditional sectors.

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