LONDON European tin
premiums could soften during the first quarter as prices for
material on the London Metal Exchange continue to climb.
Premiums have remained unchanged
for several months as the market continues to be illiquid, but
the higher LME prices could drive even more buyers away, market
"The significant price rise on
the LME has taken many consumers by surprise, so they are not
rushing in to buy," one trader told AMM sister
publication Metal Bulletin.
Three-month tin prices on the
LME traded at $24,150 per tonne in the official session
Thursday compared with $23,455 per tonne on Dec. 27.
Trading has been quiet across
the base metals as the new year begins, and tin has been no
exception, a second trader said.
"It has been a quiet start on
the tin front, and with these high prices, I think warrant
business will struggle initially," he said.
Momentum is likely to continue
to be subdued in the spot market for the next few days, with a
number of participants remaining out of the market following
the year-end holidays.
"We expect there will be more
spot business next week when everyone is back to work and in
full swing again," the first trader said. "This will give a
better guide to the actual state of the market."
Once this happens, market
participants said they expect premiums to lose strength as the
rally in base metal prices continues.
Premiums for 99.85-percent tin in Europe have traded at $350
to $500 per tonne since July.
An earlier version of this
story appeared in AMM sister publication Metal