Rotterdam 99.9% premium up again while Indonesian supply tightness looms
- Rotterdam 99.9% premium rises
- US and China premiums steady
- Indonesian exports expected to slow down
The tin premium for standard purity tin increased further in Rotterdam this week in anticipation of lower exports from Indonesia over the next month or two.
The premium for 99.9% tin ingots with 300ppm lead content
rose at the bottom end to $340-375 per tonne in-warehouse Rotterdam on Tuesday March 27 from $325-375 a week before.
Deals were reported at the top end of the range, albeit in quiet spot trading conditions, with offers rising while traders anticipate a supply crunch in Europe around late April and May.
“$350 is the strict minimum at the moment – with the government tightening its grip on export licenses in Indonesia, many suppliers won’t manage to get their stocks out of the country,” a tin trader said.
The Indonesian government is reviewing its export regulation – it has announced a temporary freeze on new licences and threatened to revoke existing ones, pending clarification on whether local agencies are compliant with current export policies, according to trade sources.
“It all sounds very messy. It is severely reducing export availability of tin from Banka, premiums are rising and big gaps are likely for late April and May arrivals in Europe, and other locations,” another trader in Europe said.
This coincides with continued production problems at Refined Bangka Tin
, which is not selling on spot and even experiencing delays in its contractual deliveries while its smelter is being equipped with a new electrolytic furnace.
Exports from Indonesia have already dropped in March and with only a few days left in the month, they look set to reach their lowest level in at least nine months.
Only 3,915 tonnes have traded on ICDX for exports so far compared with 7,015 tonnes in February and 5,245 tonnes in January. PT Timah is said to be doing most of the exports.
Concurrently, demand has remained steady across various sectors.
US tin premiums holding firm
The US delivered premium
and the US in-warehouse Baltimore premium
both remained unchanged at $550-625 per tonne and $480-580 per tonne, respectively.
Steady demand for material continues, though some market participants were concerned that the upcoming Easter holiday could negatively impact demand.
No supply issues have been reported, with the market appearing to be balanced overall.
“Not much is happening. We’re busy, but there’s no change in the market,” one US-based trader said.
Meanwhile, the tightness in the trucking industry continues to cause delays when shipping material. Market participants are worried that the situation will get worse with the electronic logging device mandate going into full enforcement on April 1.
A second US-based trader said that he’s been waiting for a week to have his material picked up and delivered from a Baltimore warehouse. “[The situation] is starting to have a pretty big effect in terms of picking up material,” the trader said.
China premiums flat
In China, tin premiums for 99.85%
and 99.9% tin ingots, cif Shanghai
, and 99.9% tin ingots, low lead, cif Shanghai
, were unchanged at $150-170 per tonne, $230-250 per tonne and $320-350 per tonne, respectively, due to weak spot demand.
The market is keeping a close watch on tolling license issues.
China imported 19,561 tonnes of tin concentrates in February, up 124.7% on a yearly basis, and exported 745,920 tonnes of refined tin, around 146 times the number of tonnes exported at the same time last year, according to customs data.
Shanghai Futures Exchange tin stocks decreased
381 tonnes to 4,677 tonnes as of March 23.