The most-traded SHFE tin contract fluctuated rangebound during the night session, with strong wait-and-see sentiment prevailing in the market. [SMM Tin Morning Brief]

SMM Tin Morning Brief on December 2, 2025:

Futures: The most-traded SHFE tin contract (SN2601) fluctuated rangebound during the night session, holding firmly above the 300,000-yuan mark and closing at 306,890 yuan/mt, down 0.27% from the previous trading day.

Macro: (1) In November, Tesla's (TSLA.O) sales continued to decline in several European markets, leading to a drop in its market share in countries with strong EV demand. Data from the French Automobile Manufacturers Association showed that Tesla's new car sales in France fell 58% year-on-year to just under 1,600 units in November. France is the EU's second-largest auto market after Germany. Tesla's sales also fell 49% in Denmark and 59% in Sweden. However, Norway was an exception, where Tesla's registrations surged 175% in November, partly due to uncertainty about future EV tax incentives. (2) The US Fed has sometimes been criticized for pursuing excessive consensus in decision-making, but a series of dissenting votes on interest rate issues may emerge in the future, which could weaken the effectiveness of its policy signals. Regardless of the outcome of this meeting, the possibility of multiple dissenting votes is high. Among the 12 voting members of the committee, up to five have expressed opposition or skepticism about further interest rate cuts, while three governors hope to cut interest rates. (3) The US Fed stated that due to concerns about "rising interest rates, tightening underwriting standards, and declining commercial real estate values," banking regulators are monitoring the commercial real estate portfolios of community and regional banks. In a supervisory report released on Monday, the Fed indicated that these factors could affect borrowers' ability to refinance or repay loans. Officials are closely monitoring trends in commercial real estate lending while also scrutinizing underwriting practices and credit loss reserve levels. Among Wall Street banks, the agency's regulators are monitoring weaknesses in capital planning and liquidity risk management practices. However, the Fed's report found that as of Q2, the vast majority of banks reported capital levels well above applicable regulatory requirements.

Fundamentals: (1) Supply-side disruptions: Tin ore supply is tightening in major production areas such as Yunnan. Most smelters are expected to maintain stable production in December. (2) Demand side: Orders have decreased significantly due to weak demand in the consumer electronics and home appliance markets. Downstream procurement remains cautious, and high prices are noticeably suppressing actual consumption. Limited boost from emerging sectors: Although increased AI computing power and growth in PV installations have driven some tin consumption, their current contribution remains small and insufficient to offset the decline in traditional sector demand.

Spot Market: The spot market exhibited limited acceptance of high prices, showing clear "price resistance" sentiment, which dampened downstream purchase willingness. Traders reported only sporadic just-in-time procurement in the market, with overall spot trades being very sluggish. A strong wait-and-see sentiment prevailed.

[Data Source Statement: Except for publicly available information, other data are processed by SMM based on public information, market communication, and SMM's internal database model, and are for reference only, not constituting decision-making advice. The information provided is for reference only. This article does not constitute direct investment research or decision-making advice. Clients should exercise caution in decision-making and not use this to replace independent judgment. Any decisions made by clients are unrelated to SMM.]