The Most-Traded SHFE Tin Contract Consolidated and Rebounded in Night Session, Downstream Enterprises Showed a "Wait-and-See amid Price Declines + Sporadic Orders" Stance [SMM Tin Morning Brief]

SMM Tin Morning Brief for July 17, 2026:

The most-traded SHFE tin 2608 contract drifted higher during the night session, closing at 412,270 yuan/mt, up 0.53%.

Macro:

(1) On July 16, the signing ceremony of the agreement to establish the World Artificial Intelligence Cooperation Organization was held in Shanghai, with representatives from 29 countries signing the agreement and becoming founding members. UN Secretary General Guterres and representatives from other countries and international organizations attended the ceremony. Previously, the AI development logic familiar to many was based on an old technological order — core technologies were held in the hands of a few, while other participants could only access products and services but found it difficult to truly accumulate their own technical capabilities. After entering the artificial intelligence era, closed-source models, paid interfaces, limited computing power, and locked-in ecosystems mean that the higher the concentration of technology, the more entrenched the dependency relationships in the global AI industry become. What China wants to explore is a different order — bringing together all of humanity and all countries to build an open-source, full-factor AI ecosystem.
(2) TSMC Chairman Wei Zhejia said that TSMC would reflect the value of its own technology and manufacturing, but would not suddenly raise prices significantly, let alone quadruple or quintuple them at once, making it impossible for clients to survive in the market. He further pointed out that TSMC's pricing principle is to capture fair value while maintaining a gross margin sufficient to support long-term investment and continuous capacity expansion, which benefits both TSMC and its clients. Speaking of the stunning recent profitability of memory chip makers, Wei frankly said he envied the 86% gross margin of memory companies, and then joked, "TSMC doesn't need to reach 86%; 'if I had 68%, I would be very happy'." Wei reiterated that TSMC's most important principle remains being a trustworthy partner for clients; it will not suddenly hike prices just because the market is tight, but will earn reasonable returns while supporting long-term capacity expansion, on the premise that its clients can sustain growth.

Fundamentals: (1) Supply side: The tight tin ore supply pattern has not been resolved, but marginal improvement signals are increasing. In July, most smelters focused on maintaining stable production. (2) Demand side: The traditional off-season effect is deepening, with rigid demand support coexisting with high-price suppression. Downstream purchasing remained cautious, with purchases based on orders.

Spot market: Traders lowered their quotes tracking the futures market, while some smelters still tried to hold prices firm but their room for adjustment was suppressed by the futures market; downstream solder and electronic processing enterprises displayed a mixed attitude of "waiting on price dips + scattered order placement" — the traditional off-season combined with the cautious mindset from being trapped after chasing higher prices the previous day meant that downstream users did not restock in volume simply because of the price decline. Inquiries increased slightly in the afternoon session, and transactions were a bit better than in the morning session, but overall remained at the level of rigid demand, small orders, without moving into bulk buying.

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