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Market Briefing - May 18, 2009
The price of tin surged to $14,400/tonne on 13 May, a near six
month high, driven by short-covering and fund buying. In addition,
the monthly average rose to $11,743 in April, its highest level
for four months. Continued problems at major producers, China and
Indonesia, have also served to assist the rally. However, thus far,
these supply problems have had little effect in supporting the price,
beaten down by the dire demand environment to record its lowest
monthly average in 27 months in March of $10,675/tonne.
Tin stocks have continued to increase, and are now back above 13,000
tonnes at 13,405 tonnes on May 13. This is up 21% on levels seen
at the start of the second quarter, and, given the problems on the
supply side, highlights the severity of the demand downturn.
Sluggish mine production feeds into lower
refined output in 2009
Global concentrate production has faltered over the first two months
of 2009, down 22.6% y-o-y at 38,800 tonnes, according to the WBMS.
This has continued a declining trend after mine production fell
11.1% in 2008 to 311,500 tonnes. Insufficient raw material supply
is becoming a significant problem for tin smelters. Many, who previously
stopped production primarily due to the low prices, are now struggling
to restart due to the shortage in raw material supply.
> This article gives the introduction to our latest detailed
analysis on the market. To access our latest detailed monthly report
on the base metals markets plus the recent briefing update, click
on the links below.
> Base
Metals Market Briefing - December 9, 2008.
> Base
Metals Market Briefing Update - December 16, 2008.
Disclaimer: Whilst
every effort has been made to ensure the accuracy of the information
used in this document, GFMS Metals Consulting cannot guarantee such
accuracy and GFMS Metals Consulting does not accept responsibility
for any losses or damages arising directly, or indirectly, from
the use of this information.
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