Prices on the Global Tin Market Soar on Robust Demand Recovery

IndexBox has just published a new report: 'World - Tin - Market Analysis, Forecast, Size, Trends and Insights'. Here is a summary of the report's key findings.

Tin prices rose to record levels in response to high demand from the electronics industry and a severe supply shortage on the market. The deficit has been driven on by pandemic-related decreases in mining output in 2020, the shipping container crisis and a drop in exports due to supply-chain disruptions. Prices are forecast to fall only in 2022 thanks to ramped-up mining output and supply and demand returning to equilibrium.

Key Trends and Insights

The year 2020 was marked by an 8.8% decline in global output for tin because of pandemic quarantine measures and a drop in demand from its primary consumer -- the electronics industry. About half of tin produced in the world is used as a solder in electronics to assemble semiconductor microchips to printed circuit boards and other electronic devices.

All countries, except Russia, Congo and Nigeria, experienced a significant contraction in mining. In Indonesia, tin ore production fell by 15% y-o-y, in China by 4%, in Myanmar by 21% and in Peru by 9%.

In the first half of 2021, demand for tin used in electronics soared to record highs outpacing supply. In the U.S., Asia and the EU, a construction boom also bolstered growth in demand for the metal which is used in joining pipes. The use of tin-plated cans in the stabilizing food industry as well as in metal containers for petroleum products and lubricants contributed to the rise in demand.

The deficit in shipping containers caused delays in deliveries from Southeast Asia and Latin America while the pandemic spurred on a decline in unrefined tin exports from Indonesia. Both of these factors led to a shortage of tin on the global market. As a result, in just six months, prices for the metal grew 1.5 times on the London exchange from $20,540 per ton in December 2020 to $31,264 per ton in June 2021.

High prices for tin should incentivize mining activity to ramp up and gradually balance out supply and demand on the market. According to the World Bank, the average yearly price for tin in 2022 will decrease to $23,000 per ton and stabilize in the midterm. 

Global Tin Production

In 2020, production of tin decreased by -6.4% to 359K tonnes, falling for the third year in a row after two years of growth. In value terms, tin production reduced to $5.2B in 2020 estimated in export prices. 

The country with the largest volume of tin production was China (168K tonnes), comprising approx. 47% of total volume. Moreover, tin production in China exceeded the figures recorded by the second-largest producer, Indonesia (70K tonnes), twofold. The third position in this ranking was occupied by Peru (26K tonnes), with a 7.3% share.

Global Tin Imports

In 2020, overseas purchases of tin were finally on the rise to reach 198K tonnes (IndexBox estimates) after two years of decline. Overall, imports, however, showed a noticeable contraction. The growth pace was the most rapid in 2014 when imports increased by 5.7% y-o-y. Global imports peaked at 292K tonnes in 2007; however, from 2008 to 2020, imports failed to regain momentum.

In value terms, tin imports declined to $3.6B in 2020. In general, imports, however, recorded a slight decline. The pace of growth was the most pronounced in 2010 with an increase of 44% y-o-y. Global imports peaked at $7.1B in 2011; however, from 2012 to 2020, imports stood at a somewhat lower figure.

In 2020, the U.S. (31K tonnes), followed by Singapore (20K tonnes), Japan (19K tonnes), China (18K tonnes), Germany (16K tonnes), South Korea (14K tonnes), Taiwan (Chinese) (13K tonnes), India (9.8K tonnes) and Malaysia (9.5K tonnes) represented the largest importers of tin, together creating 76% of total imports. The Netherlands (6.3K tonnes), Spain (5.7K tonnes), Italy (4.4K tonnes) and France (4.4K tonnes) occupied a relatively small share of total imports.

In value terms, the U.S. ($540M), Singapore ($374M) and Malaysia ($368M) were the countries with the highest levels of imports in 2020, with a combined 36% share of global imports. These countries were followed by Japan, China, Germany, South Korea, India, Taiwan (Chinese), the Netherlands, Spain, Italy and France, which together accounted for a further 51%.

In 2020, the average tin import price amounted to $18,195 per tonne, with a decrease of -9.7% against the previous year. From 2007 to 2020, the most notable rate of growth in terms of prices was attained by Malaysia, while the other global leaders experienced more modest paces of growth.

Source: IndexBox Platform