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Tin prices rise after Myanmar earthquake

Tin prices rise after Myanmar earthquake

On Friday, tin prices in London reached a two-week high as speculators made bets that the earthquake in Myanmar's main mining region could delay the restart of production.

The benchmark tin price on the London Metal Exchange increased 2.5% by 1508 GMT to $36,140 per ton after reaching $36,635, which was its highest since March 14. If it breaks above $37.100, this would be the highest level since mid-2022.

Myanmar is the third largest tin producer in the world and a major supplier of tin to China. The tin-rich Wa State mines, which provide 70% of Myanmar's total tin production, are located about 425 kilometers away from the epicentre of the earthquake, which, according to the United States Geological Survey was close to Mandalay, the capital of Myanmar.

Wa state has not been mentioned in the reports about the damage caused by this quake. According to a USGS map the intensity of the ground shaking was 4 near the tin-mining region compared to 8 at the epicentre.

In August 2023, Wa State suspended all mining in its control areas to protect the resources. According to an announcement on Wednesday, a meeting was scheduled with investors on April 1, to discuss resuming mining.

Tom Langston is a senior analyst at the International Tin Association. He said that "the rise in LME prices may be driven by speculation, but we will have a better picture very soon."

Tin prices are up 24% this year due to limited supply coming from Myanmar and Alphamin Resources' decision in March to stop operations at the third largest mine in the Democratic Republic of Congo because of the rebels' advance towards the site.

Even without the earthquake, it would take months for tin mining to resume in Myanmar's Wa State. In Congo, legitimate mining cannot restart until there is a comprehensive solution to the conflict.

The LME registered warehouses have the lowest tin inventories since mid-2023. Between 40% and 50% of all tin warrants belong to one entity. <0#LME-WHL> <0#LME-WHC> <0#LME-WHT>

The spread between the LME cash contract and the three-month Tin Contract was widened. A premium was last Friday at $185 per tonne, compared to a discount at the beginning of March of $193.

(source: Reuters)