Smartphones, cars and a prolonged mining slump are creating tighter supplies of tin, a metal used mostly as solder for electrical circuits.
Demand for tin remains strong from all sorts of manufacturers, from makers of food cans and building materials to iPads and Oscar statuettes. At the same time, big exporters like Indonesia and Myanmar are shipping less, following a three-year slump that discouraged investment in mines and smelters.
Supplies in 2016 will be the smallest relative to demand in almost two decades, industry forecasts show. Tin on the London Metal Exchange has surged into a bull market, after prices in January were at their lowest since 2009.
Unlike most other base metals, which face global surpluses this year, tin output won’t keep pace with demand, according to Minsur SA, a Peru-based producer. While economic growth is slowing in China, the biggest consumer, reduced production has sent tin inventories tracked by the LME to a seven-year low this month.
Customers at metals wholesaler Phoenixx International Resources LP in Pittsburgh are locking in prices two months before delivery rather than risk paying more later, something they haven’t done since 2014.
“People are jumping in to grab some, saying they think it’s a good price,” said Phoenixx President Brian Helsel, who has been trading tin for almost two decades. “Based on the fundamentals, I think the bottom of the tin price should be now in.”
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