How to Invest in Tin (Updated 2023)
This brief guide on how to invest in tin covers topics such as supply and demand dynamics, top producers and investment strategies.
In recent years, tin prices have been supported by surging demand from the electronics sector amid a deficit in supply.
Between late 2020 and early 2022, upward pressure in the market resulted in price highs not seen in a decade.
Although tin faced the same downward pressure as other commodities in the latter half of 2022, currently its fundamentals remain "supported by worries about tight global supplies after Myanmar, the world's third-largest producer, banned mining activities," according to Trading Economics. "On top of that, Indonesia, the largest exporter of the metal in refined form, was mulling a ban on shipments to stimulate the build-out of downstream processing capacity."
Tin is primarily used to coat other metals due to its ability to retain a high polish and prevent corrosion. Tin is also an alloy metal used in soldering and the production of rare earths superconducting magnets.
Because of its strong fundamentals, interest in tin investing is increasing. To help investors looking to jump into this commodity sector, the Investing News Network has put together a brief guide on tin supply and demand dynamics, as well as an overview of how to start investing in this silvery white metal.
What factors impact tin supply and demand?
The tin market has been in deficit for the past decade, and supply is expected to remain constrained as demand rises.
Due to its many positive characteristics, there are a slew of important uses for tin. For example, the metal is malleable, ductile and not easily oxidized in air; it’s also lightweight, durable and fairly resistant to corrosion. Those qualities make tin, which is obtained from the mineral cassiterite, a good candidate for use in solder, as well as tinplate, chemicals, brass and bronze and other niche areas.
In terms of where tin is produced, China was the world’s top tin producer in 2022; the country put out 95,000 metric tons (MT) of the metal. Indonesia is close on China’s heels at 74,000 MT, and third on the list is Burma at 31,000 MT. Total world output for the year was 310,000 MT, up by only 5,000 MT from the previous year, and world tin reserves sit at 4.6 million MT.
Like tungsten, tantalum and gold, tin is a conflict mineral. Armed groups in the Democratic Republic of Congo (DRC) earn hundreds of millions of dollars every year by trading these minerals.
Currently, the Dodd-Frank Act in the US requires public companies that source minerals from the DRC to produce independently audited reports about the ownership and origin of these mined commodities; these documents must be provided to the US Securities and Exchange Commission.
What are the ways to invest in tin?
As mentioned, investing in tin is becoming more and more appealing as demand for the metal grows.
Those wishing to begin tin investing may want to consider exchange-traded products, such as the iPath Series B Bloomberg Tin Subindex Total Return ETN (ARCA:JJT).
There are also tin futures, which are traded on the London Metal Exchange under the code SN, with contract pricing in US dollars per MT. Clearable currencies include the US dollar, yen, pound and euro.
Of course, tin investing can also be done by buying shares of tin-focused companies, such as the aforementioned top tin-producing companies Yunnan Tin, PT Timah and Malaysia Smelting — click here for the full list. Smaller-scale tin miners include Alphamin Resources (TSXV:AFM,OTC Pink:AFMJF) and Metals X (ASX:MLX,OTC Pink:MLXEF).
Exploration- and development-stage tin projects are relatively rare, but investors may want to consider companies such as Cornish Metals (TSXV:CUSN,LSE:CUSN), Elementos (ASX:ELT), Stellar Resources (ASX:SRZ), TinOne Resources (TSXV:TORC), Tincorp Metals (TSXV:TIN,OTCQX:TINFF) and Venture Minerals (ASX:VMS,OTC Pink:VTMLF).
This is an updated version of an article first published by the Investing News Network in 2019.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
Editorial Disclosure: TinOne Resources is a client of the Investing News Network. This article is not paid-for content.