Highlights

  • LME cash tin held at US$46,345/t on 10 Nov, flat on the day but down 10.4% from US$51,700 on 28 Oct and 3.3% on the week.
  • Tin trades as an AI proxy; a US$3.2 trillion Wall Street selloff on fears a Democratic Congress could slow data-centre building dragged it to an eight-month low.
  • LME stocks of 3,840 t and a cash premium to three-month metal show physical tightness that could reassert itself once tech sentiment steadies.

Tin has been dumped alongside AI stocks, even though the metal in London and Shanghai warehouses is scarcer than it has been in four years.

What happened

Tin's slide has stalled, but the damage is done. LME cash tin settled at US$46,345 a tonne on 10 Nov, virtually unchanged from US$46,350 the previous day, with three-month metal at US$46,315.

The bigger story is the past fortnight. Cash tin fetched US$51,700 on 28 Oct, so it has lost about 10.4% since then, and it is down 3.3% from US$47,905 on 3 Nov. A month earlier, on 13 Oct, it stood at US$53,000.

Three-month tin touched an eight-month low of US$45,360 during the selloff. The sharpest single-day fall in the official settlements came on 6 Nov, when cash dropped from US$48,100 to US$46,325, about 3.7%.

Why it happened

This was a sentiment shock, not a Supply one. Tin is the solder that holds chips and servers together, so it has traded as an AI proxy all year. When Wall Street lost US$3.2 trillion in a day on fears that Democrats could slow AI data-centre construction, tin went down with the tech stocks.

The slump has been linked to a "blue wave" in the 3 Nov US midterms, seen as making curbs on AI data centres more likely, and to fears the Fed could hike rates in December. Earlier, a tech selloff after Alphabet's Earnings had already pushed tin below US$49,000 for the first time since late April.

The International Tin Association's Tom Langston summed it up: AI's biggest impact this year "has been on investor sentiment" rather than actual consumption. Meanwhile, slower Chinese solar installations, a use that accounts for about a tenth of global tin demand, have cooled physical buying.

How it plays out

Here is the twist: the physical market is tight. LME stocks fell to 3,840 tonnes on 10 Nov from 4,325 tonnes on 7 Oct. Total exchange stocks across London and Shanghai are just under 9,000 tonnes, a four-year low.

The curve agrees. LME cash has flipped from a discount of more than US$350 to three-month metal in August to a premium of about US$125, the highest since December. On 10 Nov cash still sat US$30 above three-month. Low exchange stocks are largely a supply story.

Supply is tight for real reasons. Indonesia's crackdown on illegal Mining cut exports 14% year on year to 32,800 tonnes in the first nine months, and Yunnan Tin's Gejiu smelter, which makes 5,000-6,000 tonnes a month, began a 45-day maintenance shutdown in late September. Against that, output is expected to recover gradually as Myanmar's mines normalise.

The winners from the drop are electronics and solder makers, who get cheaper metal after a year of high prices. The losers are investors who bought tin as an AI play, and miners who had enjoyed elevated prices. Chinese spot buyers still face high premiums because imported cargoes are essentially sold out.

Next week, watch AI-chip stocks first, since tin is trading off them. Then watch the LME spread: a widening backwardation would show physical tightness reasserting itself. A restart at Gejiu, due around mid-November if the 45-day schedule holds, could ease Chinese supply.