Disagreements between bulls and bears intensified at the 260,000 threshold, with SHFE tin prices fluctuating considerably [SMM Tin Midday Review]

Lunchtime Commentary on the Most-Traded SHFE Tin Contract on May 12, 2025

As of the lunchtime on May 12, the most-traded SHFE tin contract (SN2506) continued its sideways movement. It opened at 259,710 yuan/mt in the morning session, slightly higher than the previous trading day's closing price (259,540 yuan/mt). After opening higher, it faced pressure and pulled back, with the price fluctuating rangebound around the 260,000 yuan/mt level. By lunchtime, it closed at 262,130 yuan/mt, up 0.48% intraday. Trading in the spot market remained sluggish, with downstream enterprises primarily making small, just-in-time purchases, showing a strong wait-and-see sentiment.

The US GDP contracted by 0.3% QoQ in Q1, with government spending, particularly defense expenditures, shrinking significantly (down 1.4% on a QoQ annualized basis). Coupled with the slowdown in non-farm payroll growth to 177,000 in April, these factors indicate a weakening economic momentum. Although core PCE inflation fell to 2.65% YoY, the impact of tariff policies on imports (China's shipments to the US plunged by 44% YoY in May) may accelerate inventory drawdowns in Q2, further dragging on consumption and capital expenditures. Medium and long-term inflationary pressures persist. The US Fed maintained interest rates unchanged, but the passivity of its policy stance increased. Market expectations for interest rate cuts have pulled back, and the stabilization of the US dollar index has pressured non-ferrous metal prices.

Open interest in the most-traded SHFE tin contract rose to 36,200 lots, with intensified divergence between bulls and bears at the 260,000 yuan/mt level. From a technical perspective, prices are sideways moving within the 257,000-267,000 yuan/mt range. The MACD indicator suggests strong short-term momentum, with 260,000 yuan/mt becoming a key level separating bullish and bearish sentiment.