Transforming tin: From unsexy solder to solar panel superstar

While not really what someone would consider a sexy metal, tin is suddenly looking a lot more attractive as a wave of supply disruptions ripple through the market and its value starts to be realised in the clean energy transition.

Tin hit its highest point since June 2022, when it reached an intra-day peak on the London Metal Exchange (LME) of US$33,130 ($51,549) per tonne on 10 April 2024.

Since October 2022, the price has gained over 80% from a low of less than US$18,000/t to over US$32,350/t on 16 April 2024.

Ali Ukani, who heads corporate and ESG advisory for Peak Asset Management, tells Mining.com.au the key demand drivers of this surging price is growth and investment in solar panels, as well as semiconductor demand (tin is used in solar ribbons and soldering). 

“Another use is in EVs as well due to the amount of soldering required,” he explains.

Tin is ideal for soldering because it does not require a lot of force to cut it, so much so a bar of tin can easily be bent by hand. Soldering is required in everything from smartphones and laptops to wearable devices. 

The more technologically advanced products get, the more soldering is needed due to the increase in circuits used. 

Packaging is also still a key use for tin, with major drink manufacturer Red Bull alone selling over 4 billion cans a year, according to market intelligence firm Emergen Research. 

The International Energy Agency (IEA) says that in 2023, solar photovoltaic (PV) systems accounted for three quarters of renewable capacity additions globally, and this will continue to increase in the next five years, with solar PV and wind envisaged to account for a record 96%.

That is largely due to generation costs being lower for solar PV and wind than for both fossil and non-fossil alternatives in most countries, as well as government policies continuing to support the global clean energy push, according to the IEA.

“Solar PV and wind additions are forecast to more than double by 2028 compared with 2022, continuously breaking records over the forecast period to reach almost 710 GW,” the IEA says. 

Source: International Energy Agency 

Semiconductor demand, meanwhile, is projected to more than double to US$1.38 trillion by 2029, up from US$573.4 billion in 2022, at a compound annual growth rate (CAGR) of 12.2%.

Couple that with a looming supply deficit resulting from disruptions to production in Africa, Indonesia, Myanmar, and Peru, and you have the perfect storm for a tin comeback.

Global refined tin production slid 2.1% in 2023 to 370,100 tonnes, according to the International Tin Association (ITA), with half of the world’s top producers reporting lower output compared to 2022. 

The biggest drop of nearly 23% came from Indonesia’s PT Timah Tbk.

Peak Asset Management’s Ukani tells this news service that Indonesia and Myanmar, the world’s largest suppliers, are currently “problem-riddled jurisdictions”. 

“Indonesia has a change in permitting systems due to illegal mining, this has impacted nickel as well,” he says.  

“Regarding Myanmar, all mining was suspended in August last year to allow for an audit of reserves. The suspension has been partly lifted for some smaller operators, although they will pay more in export tax.”

Statistics from Trade Data Monitor showed that these disruptions resulted in a decline in Myanmar’s exports of tin ores and concentrates to China to around 180,000t (or 72% of China’s imports) in 2023, down from over 187,000t (or 77%) a year earlier. 

China is the largest producer of refined tin and the world’s largest consumer.

Meanwhile, the ITA said earlier in April that ongoing attacks by the M23 rebels in the North Kivu region of the Democratic Republic of the Congo – an important region for global supply of tin, tantalum, and tungsten – posed a threat to key supply areas and routes critical to the trade of tin concentrates.

“Delays may be expected as mineral shipments are rerouted further north and south away from rebel-controlled areas.”

While many of the factors affecting tin supply are likely to be short term, the longer term outlook is still very positive for further growth.

The World Bank expects metals prices to dip 5% this year due to slowing demand, but sees a recovery in 2025 as global activity improves and the demand for metals in renewable energy technologies accelerates.

Emergen Research predicts the tin market will climb to US$10.12 billion in 2032, up from US$7.09 billion in 2022, at an anticipated CAGR of 3.6%. 

Tin stockpiles are also dwindling, now sitting 46% lower at 4,145 tons compared to the start of the year, marking the lowest point since July 2023.  

The ITA expects to see a reversal of the significant stockpiling that occurred last year.

“An expected recovery in demand and ongoing supply disruptions especially in Wa State and Indonesia may bring supply tightness in 2024.”

Write to Angela East at Mining.com.au 

Images: Unsplash
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Written By Angela East
Managing Editor Angela East is an experienced business journalist and editor with over 15 years spent covering the resources and construction sectors and more recently working as a communications specialist handling media relations for junior resources companies.