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Forecasts and market analysis based on price assessments from Fastmarkets MB and Fastmarkets AMM

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February 2018 | Base Metals


Tin: Bout of profit-taking overdue


The January rally was exaggerated by the superficial supply tightness caused by the (temporary) halt in Indonesian production and overly-negative spec positioning at the end of last year. Given our view that Indonesian supply is due to rise in the months ahead, a bout of profit-taking may soon emerge, which would bring the Q1 average back in line with our base case forecast of $20,500 per tonne.

Star performer of the year... but for how long?
Tin has played some catch-up with its LME peers since the start of the year. After underperforming in 2017 (LME tin: -5% vs LMEX: +29%), LME tin turns out to be the star performer so far this year, up ~6%, compared with a decline of 4% for the LMEX. The resurgence of buying interest in tin, evident in the rise of open interest, seems to be mainly driven by supply tightness, although temporary, caused by Indonesia. In this week’s analysis, we identify the major positive and negative forces shaping the tin market outlook for 2018.

The positives

The WBMS shows the refined tin market was in a deficit of 1,265 tonnes in November 2017, bringing the January-November 2017 deficit to...

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