From May 31st to June 2nd, the 1 # tin ingot market in East China rose, with an initial market average price of 424960 yuan/ton. As of June 2nd, the market average price was 442580 yuan/ton, an increase of 4.15%.
Entering June, tin prices continued their strong performance since the beginning of the year, and market attention increased significantly. On June 2nd, the main contract of Shanghai tin closed up more than 5%, reaching a high of 449960 yuan/ton, maintaining a high level of operation. The non-ferrous sector led the way in the tin direction, with multiple stocks hitting the daily limit up or significantly following suit. From the cumulative increase since the beginning of the year, Shanghai Tin has risen by about 33% this year, and LME Tin has risen by nearly 40%, with market trading sentiment continuing to heat up.
The following analysis from the supply and demand side: the bidirectional resonance between “rigid contraction of supply” and “structural explosion of AI computing power demand”
supply side
The three major producing countries are simultaneously facing supply reduction difficulties: Myanmar’s Manxiang mining area is constrained by factors such as civil explosive factory accidents and material approvals, with production capacity only restored to 40% to 50% of pre mining levels. In addition, the rainy season from May to July further restricts open-pit mining and transportation, making it difficult to see short-term growth; On the Indonesian side, the update of export licenses coupled with the government’s crackdown on illegal smelting resulted in a nearly halving of refined tin exports in April, and a further 32% year-on-year decrease in exports in May. At the same time, the highest royalty rate doubled from 10% to 20%, comprehensively raising the production cost of tin ore; In the Democratic Republic of Congo, the export of Bisie tin ore has been hindered due to the closure of the Goma port, coupled with geopolitical and public health disturbances, leading to uncertainty in approximately 6% of the global tin ore supply. Under the triple disturbance superposition, the tight logic of the raw material end continues to strengthen, and the cost transmission from the mining end to the smelting end continues to advance.
demand side
Tin, as a ‘computing power metal’, presents distinct differentiation: tin usage in high margin tracks such as AI servers and optical modules has surged and is not afraid of price increases, while traditional consumer electronics are cost sensitive and procurement is in a wait-and-see state. This kind of ice and fire game is forcing midstream and downstream enterprises to transform towards high-end. At the same time, global tin mines can only be mined for 15 years (12 years in China), but tin can be recovered and regenerated without damage. Top enterprises are laying out a “mining recycling regeneration” closed-loop, and recycling tin has become a strategic direction to overcome resource bottlenecks. What is even rarer than computing power itself is the underlying resources that support computing power – whoever can afford high priced tin will dominate the future of the industry chain.
comprehensive analysis
In the short term, upstream supply disturbances will continue to be the dominant force in tin prices, supporting the continued strong operation of tin prices. On the other hand, downstream electronic solder has entered the traditional consumption off-season, and some terminals are adopting a wait-and-see attitude towards high prices, with spot transactions tending to be cautious. The short-term tin price is likely to maintain a high and wide range oscillation pattern. In the medium to long term, the supply-demand gap will continue to provide solid upward support for the tin price center.
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