By Stuart Burns
According to the International Tin Research Institute (ITRI), the main negative feature of future tin demand and consumption, covered by several speakers, was the impact of miniaturization and the trend away from wave soldering on electronics solder volumes. Valentijn van Velthoven of Alpha Asia is quoted as forecasting that cyclical recovery in electronic equipment production could result in 6%-7% industry growth rates in 2014-15, but area growth in printed circuit board production (which the company had found correlated closely with solder sales) might only be 1% per year.
Countering this is the likely positive impact of increased use of lead-free alloys in telecommunications, automotive ,and medical applications (which are collectively estimated to account for 34% of the market) in the coming years. It was noted that the prospect of a move from voluntary to mandatory restrictions on lead use in the China consumer products market from as early as July 2014 would also have a positive impact on tin demand. Clearly, the situation is a dynamic one.
On balance, the restricted supply market in the world's largest consuming country, coupled by increased demand from new applications, will likely outweigh the effects of miniaturization to lift prices over time. New mine supply is slowly coming on-stream, but the majority of projects do not reach commercial production and the supply market remains constrained. Higher prices will be required to keep exploration and development ongoing. The question is: When will the uplift come? While the outlook is not bright in coming months, it is more positive further out. As in the case of many of the base metals, the markets are waiting for signs of stronger industrial growth.