Boom in electronics sales pushes tin prices to their highest level in 10 years
Tin prices hit their highest level in a decade on Friday, driven by a boom in consumer electronics and sales of 5G smartphones.
The metal, which is used in soldering circuit boards, has risen 133% since its March 2020 low, as sales of smartphones, laptops and iPads increased due to people working and studying at home.
Tin last traded at $ 30,760 per tonne, compared to $ 30,960 per tonne on Friday.
Tin is one of many commodities benefiting from a rebound in consumption as economies recover from the impact of Covid-19. Copper prices have also increased 30 percent this year.
“Whatever electronic devices were installed in offices, they are now in people’s homes, and no one got rid of old electronic devices, they bought new ones,” said Jonathan Narunsky, a trader in the area. tin at Gerald Metals. “The consumption of electronics has effectively doubled.”
Electronics retailers have seen exceptional sales this year, with Apple posting double-digit growth in the first quarter of 2021, driven by iPhone sales.
“Without tin soldering, the technology stops,” said Maritz Smith, general manager of Alphamin tin miner. “Everywhere you look, tin is used in circuit boards and the supply takes time to catch up.”
The rise in prices has benefited tin miners, with shares of Yunnan Tin in China rising 43% this year on the Shenzhen Stock Exchange. The company said its first-quarter net profit rose 588% from a year earlier during the lows of the pandemic.
The price of tin is also benefiting from supply disruptions in China and the Democratic Republic of the Congo.
A drought in southwest Yunnan Province has resulted in a shortage of hydroelectric power, forcing some tin smelters to close for 10 to 20 days and impacting between 1,000 and 2,000 tonnes of production, according to the International Association of tin.
“Currently, heavy rains are forecast for June, which will fill the hydroelectric reservoirs,” the association said. “However, it is not known how long this will take, and foundries are currently not about to restart.”
The restrictions mean China is less likely to export tin to international markets, Narunsky added. “The market predicted that some Chinese units would leave the coast,” he said.
The eruption of a volcano outside Goma in DRC last weekend also delayed the processing of export documents. the DRC produces about 8 percent of the world’s tin supplies. Alphamin, whose mine is located about 200 kilometers west of Goma, said export services are expected to return to normal during the first week of June.
“We think it’s temporary, the government is working really hard to fix this problem,” Smith said.