TIN MARKET OUTLOOK. Can tin weather the trade storm?

Transcription

1 TIN MARKET OUTLOOK Can tin weather the trade storm? DATE: 2/11/18 PREPARED BY: Tom Mulqueen, ITA PREPARED FOR: Beer and Co Tin Conference, November 2018

2 Presentation outline tin market in review 2 Consumption trends and prospects 3 Tin supply outlook 4 Conclusions

3 Tin market in review tin market in review 2 Consumption trends and prospects 3 Tin supply outlook 4 Conclusions

4 1 Jan 1 Feb 1 Mar 1 Apr 1 May 1 Jun 1 Jul 1 Aug 1 Sep 1 Oct Price, US$/t $22,500 $22,000 $21,500 $21,000 $20,500 $20,000 $19,500 $19,000 $18,500 Indonesian export quota delays Indonesian export quotas granted Indonesian export license delays Indonesian export licenses granted Myanmar production speculation Trade tensions, slowing China growth, stronger US$ ICDX private smelter trade halt LME tin price developments in 2018

5 1 Jun 1 Jul 1 Aug 1 Sep 1 Oct Indexed LME 3-month price Index base = Cu Pb Zn Al Ni Sn LME price in the year to 31 October % change Sn Ni Al Cu Zn Pb -30% -20% -10% 0% Tin weaker but outperforming peers

6 Market presentation outline tin market in review 2 Consumption trends and prospects 3 Tin supply outlook 4 Conclusions

7 Refined tin, 000 tonnes % in % in 2018 projected Trend growth in global refined tin use Tin use growth has stalled in 2018

8 Tin use by application Total refined tin use in 2017: 362,500 tonnes

9 ROW tin use picks up as China growth stalls 250 Refined tin, 000 tonnes China Rest of world

10 Solder demand lags electronic white goods output in China % growth in white goods, '000 tonnes of refined tin consumption 30% % 20% 15% 10% 5% 0% -5% -10% -15% Prior year's weighted growth in China white goods output (%) China refined tin use in solder ('000 tonnes)? China solder demand to weaken?

11 Solder Chemicals Tinplate Electronics and solar panel growth PB Ongoing conversion to lead-free solders Lead-acid batteries Rising construction demand New glass coating applications Growing stationary battery demand Growing demand in emerging economies Opportunities in existing applications Higherperformance batteries using more tin

12 The imminent technology supercycle Energy and technology to drive tin demand significantly from 2025

13 Increased electronics Electric vehicles Energy infrastructures Drones \ IoT Robotics Computing \ 5G Solar cell solders Tinned wire & cable Tinned connectors Tin Headline connects everything together

14 Zero-emission targets Transport Renewable energy Tin technologies Advanced Lead-acid Lithium-ion Sodium-ion ++ Liquid metal ++ Energy Headline storage

15 Solar cell materials Copper Zinc Tin Sulphide Tin Perovskites Heat harvesting Solar heat transfer Thermoelectric materials Hydrogen tech Water splitting Fuel cell catalysts Carbon capture Tin catalysts Energy Headline generation

16 Conductive films Display screens Solar cells Semiconductors Transparent components Superconductive Lasers Opto-electronics Sensors Electronic Headline materials

17 Tin supply outlook tin market in review 2 Consumption trends and prospects 3 Tin supply outlook 4 Conclusions

18 Where was tin mined in 2017? Size of circles proportional to 2017 tin mine output

19 Change in tin mine output, 2018f vs 2017 Contained tin, 000 tonnes China Indonesia Africa Brazil Russia Malaysia Peru Other Australia Bolivia Myanmar -10% -4% -8% -7% +12% +8% +62% +9% +1% +7% +7% 2018 forecast =324,600 tonnes (up 2.2% from 2017) Data: ITA estimates

20 Jan Feb Mar Apr May Jun Jul Aug Sep Oct 14,000 12, Indonesian export indicators Refined tin, tonnes ICDX sales Surveyor data Customs 10,000 8,000 6,000 4,000 2,000 0

21 Risks for future Indonesian supply Regulation and enforcement Currency fluctuation Oil prices Resource depletion High-cost marginal tin producers particularly vulnerable

22 80,000 Myanmar tin mine output appears to have peaked Tin content of ore and concentrate, tonnes 70,000 60,000 50,000 40,000 30,000 20,000 10,000 Wa state Other Myanmar e

23 Investments in supply Major known new tin projects under construction (Those > 2,500 tpa) Image source: Mineria Peru Name: Bisie Location: DR Congo Company: Alphamin Projected capacity: 10,750tpa Targeted start date: mid-2019 Name: B2 tailings Location: Peru Company: Minsur Projected capacity: 4,750tpa Targeted start date: late-2019 Name: Weilasituo Company: Weilasituo mining Location: Inner Mongolia, China Projected output: 3,000tpa Targeted start date: 2020 Potential additional 18,500 tonnes of tin mine output per year by 2020 from these projects

24 Top Submerged Lance furnaces (Leading technology) Current operations San Rafael (Peru) 2016 Renison (Australia) 2018 Projects (known examples) Achmmach, Morocco Taronga, Australia East Kemptville, Canada Headline Optical ore sorting proliferates

25 Potential changes in mine production 2022 vs 2018 Change in annual tin mine production, 000 tpy

26 Benchmarks and initiatives for responsible tin sourcing due diligence: Headline Consumers demanding responsible tin

27 Tin recycling A third of all tin used is from recycled sources: 55,000 tonnes 49,000 tonnes 18,000 tonnes 12,000 tonnes Secondary refined tin Solder alloy/scrap Bronze alloy/scrap Other alloy/scrap 2018 estimates for 2017

28 Sources of tin waste for recycling Solder Paste Dross Tinplate Anodes & Slimes Cans Chemicals Glass Coating Residues Lead-Acid Batteries Grid Alloys Other Bronzes, Pewter, Bearings Float Glass Baths WEEE* Copper strip Downstream manufacturers producing less midstream waste *Waste Electrical and Electronic Equipment Tin recycled mainly from production waste

29 f Reported tin stocks Tonnes 80,000 70,000 60,000 50,000 40,000 30,000 20,000 10,000 0 Reported refined tin stocks remain near recent historical lows: London Metal Exchange Shanghai Futures Exchange Producers & consumers Unreported stocks create some uncertainty

30 ,000 26,000 24,000 22,000 20,000 18,000 16,000 14,000 12,000 10,000 Medium-term price outlook Average annual LME tin price, US$/tonne FORECAST Macro-assumptions: Ongoing US-China trade tension escalation Sustained strong US dollar environment Medium-term outlook positive

31 Conclusions 1. Macro-economic developments dragging on tin market 2. New investments made in tin supply but risks remain 3. Consumers demanding responsible mineral origins 4. Consumption slowing in China but stronger elsewhere 5. Energy and tech uses to drive future tin demand 6. Price outlook weaker in 2019 but positive in medium-term Uncertainties remain: Macroeconomics Invisible stock levels Myanmar, Africa, Indonesia supply

32 2 minutes A bright future ahead for tin?

33 Thank You We believe that global co-operation on markets, technology, sustainability and regulatory issues is the most cost effective route to achieve long-term success for the industry. If we work together effectively then the outlook for tin is very positive. International Tin Association Unit 3, Curo Park Frogmore St. Albans Hertfordshire AL2 2DD United Kingdom + 44 (0) ITA China Rm 1501, Office Tower 1 Henderson Centre 18 Jianguomennei Street, Dongcheng District Beijing / chinaoffice@internationaltin.org Global co-operation for long-term success