SunSirs, Sep 02
1. Price Trend
In August 2019, the market of 1# tin ingot in China swung lower. The average market price was 135,887.50rmb/t at the beginning of August, the price was 132,000rmb/t at weekends, it had a 2.86% decrease.
On Aug 31, the Tin Commodity Index was 67.24, the same as that of Aug 30. 32.93% lower than the peak of 100.25 in the cycle (Sep 5, 2011), and 56.88% higher than the lowest point of 42.86 (Dec 9, 2015). (Cycle: Sep 1, 2011 to date)
2. Quotation Analysis
Domestic Market: International trade friction had continuous bad news to the market, affected by which, SND had slow and small falls this month. On 31 Aug, the monthly decline of SND was 8.8%, price had fallen to the lowest point since May 2016. SN was influenced as well, the price continued to fall. The price fell to 132,000 on Aug 19, 127,700 at the end of August, and the closing price was 129,480rmb/t. The spot market was dragged down by the futures market, it fell 2.86%. At the end of this month, the mainstream transaction price of the spot market is 131,000-133,000rmb/t.
Import and export：News from Jakarta on Aug 5, according to Trade of Indonesia, in July 2019, Indonesia's export of refined tin decreased 33% compared with the same period of the previous year (6,575.80t), and it fell to 4,397.40t. Compared with the export in June, it decreased 42%. Indonesia is now the world's largest exporter of refined tin.
According to the data from WBMS on Aug 21, the global gap of tin supply was 4,200 tons from January to June in 2019. The inventory is 9,100 tons more than that of the end of 2018, but this included an unexplained stock of 6,000 tons. Global refined tin production increased 2,000 tons compared with that from the first half of 2018. Asia's output decreased 800 tons year on year. Apparent demand in China increased 5.5% year on year. Global tin demand in January-June 2019 was 185,800 tons, an increase of 1.6% over the same period last year. Japan's consumption was 13,900 tons, 6.4% less from the same period of 2018. In June 2019, the output of refined tin was 33,800 tons and the consumption was 34,100 tons.
According to the data from ITA (Beijing Branch), in the first half of 2019, China's refined tin production decreased about 10% from the same period last year, and the output was around 75,000 tons. After researching on 15 Chinese factories, ITA shows that in June, the output of refined tin was about 12,500 tons, which was 9% lower compared with both a year and a month earlier. China is the leading tin producer. Cui Lin, the chief Chinese representative of ITA, said the decline in refined tin production was due to a reduction in the supply of tin concentrates in Myanmar and due to China’s weak demand. The prices of tin futures in Shanghai have fallen nearly 8% since the beginning of the year, to about 134,000rmb/t. Cui believed that the production would be affected if the price lower than 140,000rmb, because the cost of ore supply in Myanmar is high.
Major event: Timah in Indonesia expected the sales volume of tin would be 60,000t in 2019: News from Jakarta on Aug 27, Emil Ermindra, the Financial Director of PT Timah which is a state-owned tin miner, said on Tuesday that the company expected the sales volume of refined Tin would be 60,000t this year. According to the data from company, this would be twice more than 29,914t in 2018. Adi Hartadi, the vice president of investor relations, said the company sold 31,600 tons of refined tin from January to June, more than that of last year, which was about 12,700 tons. Timah produced 37,700 tons of refined tin in the first half of the year, three times as many as the same period last year. A regulation of last year allowed companies to recruit illegal miners as contractors within the franchises, and to get production from them, which led to a jump in Timah's production. Timah expected its output would be twice more to about 70,000 tons in 2019, but an official said the company has taken measures to slow down the production.
3. Prospect for the Future Market
In September, the market is full of expectations for the so called ‘gold September and silver October’. USD rose contumely and the fall from high levels should be noticed. The rebound in crude has also brought confidence in commodities. The surge of nickel is a source of confidence in the market. Next week, base metals may be able to maintain a steady and upward rhythm. It is expected that SND would have a rebound after adjusting for the drifting lower in September, but with limited strength. The spot tin market is expected to volatile mainly and inch higher.