Market Basics » Tin
Description
Tin is a chemical element with the symbol Sn (Latin: Stannum) and atomic number 50.
This silvery, malleable poor metal is not easily oxidized in air and is used to coat other metals to prevent corrosion. The first alloy used in large scale since 3000 BC was bronze, an alloy of tin and copper. After 600 BC pure metallic tin was produced. Pewter, which is an alloy of 85% to 90% tin with the remainder commonly consisting of copper, antimony and lead, was used for flatware from the Bronze Age until the 20th century. In modern times tin is used in many alloys, most notably tin/lead soft solders, typically containing 60% or more of tin. Another large application for tin is corrosion-resistant tin plating of steel. Because of its low toxicity, tin-plated metal is also used for food packaging, giving the name to tin cans, which are made mostly of steel.
Trading unit
Generally quoted in U.S. dollars per metric tonne.
Units for delivery
Ingots with a minimum purity of 99.85%, according to London Metal Exchange specifications.
Pricing mechanisms
Futures, spot, ETF
Avenues of trade
Tin futures are traded on the London Metal Exchange with a contract lot size of five metric tonnes.
Investors also can invest in tin without actually owning the metal by taking advantage of exchange traded funds. ETF Securities offers two ETFs that deal with tin pricing. The ETFS Short Tin fund moves at the inverse of the Dow Jones-AIG Tin Sun-Index, and ETFS Leveraged Tin is designed to change each day by twice the daily percentage change in the DJ-AIG Tin Sub-Index.
Physical tin also can be bought and sold using a spot price.
Supply
Tin production is concentrated in South East Asia, Latin America and China, with most smelters close to the mining regions. Although tin mining is carried out by a few large companies, there are also many independent miners that work alone or in small groups.
Some of the world's largest tin-producing companies include China-based Yunnan Tin, PT Timah of Indonesia, Peru's Minsur, Malaysia Smelting Corp., and Thailand's Thaisarco, according to the International Tin Research Institute.
Demand
Tin's main uses are in solder, tin plating and the manufacturing of chemical compounds, which are used in fire-proofing cloth, making PVC stabilisers, pesticides and wood preservatives. Tin is often used in plating for packaging, such as tin-coated steel cans.
Solder demand has increased in recent years as environmental pressure has been put on manufacturers to continue cutting lead out of solder.
Extraction, Processing, Refining & Supply Chain
Tin ores are dug from open pit and underground mines using conventional dredging, blasting, drilling, and hauling techniques.
Tin is obtained chiefly from the mineral cassiterite, where it occurs as tin dioxide, SnO2. As with most minerals, it originates in a huge reservoir of magma (molten rock) that slowly cools and crystallizes into hard rock at or near the earth's surface. If the magma contains enough tin, cassiterite can become part of the rock. Secondary tin deposits form after the rock disintegrates, which frees the cassiterite grains to join sand and gravel in semi-consolidated placer deposits. About half of the world's tin production comes from placers in southeast Asia.
Before being smelted, low-grade concentrates from complex ores are first roasted in a reverberatory or multiple-hearth furnace at temperatures between 550° and 650° C (1,025° and 1,200° F) to drive off the sulfur. Depending on the type and quantity of impurities, oxidizing, reducing, or chlorinating reactions take place. Roasting is frequently followed by leaching with water or acid solutions to remove impurities made soluble by roasting.
After appropriate preparation, the furnace feed for smelting comprises tin oxide and some impurities, including iron oxides, that were not removed in mineral processing or roasting.
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