Tin plays to a different tune from most LME metals.
It generally doesn’t attract the same speculative crowd from which copper, aluminum and zinc suffer. Its lack of any applications in jewelry keeps it firmly away from the precious metals camp. It’s termed a minor metal because the volumes are nowhere near those of its larger brethren, but for some applications it is far from minor.
As this pictorial from a recent presentation from Australian-owned Moroccan miner Kasbah Resources shows, electrical solder remains by far the most important application for tin, dwarfing tinplate (the application with which many of us most commonly associate tin).
Even tin’s use in chemicals is greater than tin plate and that application may be challenged in the years ahead by tin’s use as an additive in the manufacture of lead acid batteries. That green line disappearing to the right of the image is an arrow to a graph of projected consumption of tin in the manufacture of the perennial lead acid battery, where tin has found growing demand since the development of the sealed lead acid battery. Tin extends the battery’s life and crucially reduces the amount of antimony, deemed a toxic substance, required.
Doubters may suggest the lead acid battery is doomed, along with the internal combustion engine — in the long run, they would probably be right. But for the foreseeable future, tin is riding both horses with considerable aplomb.
The electrical complexity and consumption of electrical components in an electric vehicle (EV) is a factor of 6-10 over that of an internal combustion engine (ICE). So, not surprisingly, the amount of tin used in solder is likewise much higher.
The rise of EVs, therefore, has a direct benefit for tin consumption, even if it comes at the expense of the ICE and conventional lead acid batteries.
Kasbah’s report is crafted to bolster the case for the firm’s prospects, of course, but nevertheless makes a valid observation when it says six of the world’s top 10 tin producers reduced output last year and there has been significant underinvestment in new mines in recent years.
Tin plate may not be the largest driver of tin consumption, but tin remains a crucial component of tin plate prices. The trend for tin prices — recent pullbacks across the metals sector excepted — has been upward since last year and the supply market remains supportive for higher prices in the future.