Tin prices fallen below $40,000 a tonne on Monday on concerns due to poor spot demand and inventories rising on the London Metal Exchange (LME) and Shanghai Futures Exchange (ShFE). Since March 8 when it moved to a record $49,500 a tonne, The metal which is used mainly as soldering material in electrical and electronic products apart from as alloy and in automobile part has dropped by over 20% until Monday.
“It has been a quiet few weeks for tin, with LME prices crushing lower on a lack of spot demand and relatively healthy supply,” said James Willoughby, Market Analyst with the International Tin Association. Logistics and demand in Shanghai and the nearby areas have been disrupted by Covid restriction measures, he added.
Fitch Solutions Country Risk and Industry Research (FSCRIR) had said in February month, just before the Russia-Ukraine war broke out, tightening of Covid-19 limitations in Malaysia and Indonesia will check recovery in production. The current fall in prices can partially be assigned to the rising Covid cases in China, which has now tightened its restrictions that even set off concerns in the crude oil market.
The World Bank, however, expected a small decline in prices this year after a huge rise past year in its “Commodity Outlook” released in October 2021. Analysts are yet to take a call on whether tin’s bull run has finished after rising continuously since the Covid pandemic set in.
