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The LME three-month tin price continues to buckle under the weight of continual stock inflows and is now trading around $15,885 per tonne, down by 1.7% from the $16,175-per-tonne close on Thursday, an almost three-and-a-half-year low.
LME tin stocks have risen sharply throughout August, up by 28% since the start of the month at 6,790 tonnes after 700 tonnes of the metal arrived into LME warehouses in Singapore and Malaysia this morning.
This comes after the largest inflow in a decade on August 16, when 1,620 tonnes were delivered into LME warehouses, again in Malaysia and Singapore.
A further 60 tonnes of material were re-warranted on Friday with just 25 tonnes moved out of the LME warehousing network.
The outlook for the three-month tin price continues to darken on expectations of greater supply of refined metal in the market due to ramp-ups at Alphamin’s Bisie mine in the Democratic Republic of Congo and Afritin’s Uis mine in Namibia while end-user demand remains weak.
In zinc, the three-month price is holding on to marginal gains this morning, up by 0.4% to trade around $2,255 per tonne despite the metal’s cash/three-month spread flipping into a slim $0.50 per tonne backwardation, having been in a $10.50 per tonne contango the previous day.
“Zinc seems to be finding some support on this week’s [price] dip despite having made fresh lows” Marex Spectron’s Chester Alden said in a morning note.
But the backwardation attracted 700 tonnes of material back into the LME warehousing network on Friday, but 600 tonnes of material were removed and a further 225 tonnes were freshly canceled at the same time.
Turnover for zinc remains low with just 1,376 lots having changed hands by 10am London time amid pressure from challenging fundamental dynamic and macroeconomic headwinds.
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