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How Long Will Tin Prices Stay High?

How Long Will Tin Prices Stay High?

The tin market remains in short supply and this trend will continue throughout 2022 and potentially into 2023.  Supply is still limited and the large demand of tin will keep prices at higher levels.  This isn't a surprise as tin has been in a global supply deficit since 2019 with the supply being at all-time lows.

What is causing the increase in tin prices?

Tin price of tin has been escalating steadily since the 2008-2009 global financial crisis when the price dropped to recent low levels.

However, by the mid-2010s, the price has not only bounced back, but increased to record levels.

There are many reasons that the tin prices have continued to increase.  The strong global demand for electronics using solder and the continued disruption in ocean container shipping have been a big catalyst in the significant rise in prices.  Record inflation and the war in Ukraine have caused investors to pile into commodities like tin.

Since June, 2020, tin pricing has nearly tripled. Silver is also a component in certain lead-free solders as well as brazing alloys. Silver has decreased slightly, but is still up by about 40% since June, 2020, further compounding the cost increases of solder alloys.

Further, with the current war in Russia as well as the ongoing inflation predicted, tin prices can be expected to increase even more.

Is tin used for anything other than solder?

While some people have invested in tin as a commodity, the primary use for tin since 2006 has been the solder industry. 

Tin became used primarily in solder when the government legislated that lead-free materials are preferred in solder. Since the RHOS legislation was implemented in 2003, it is estimated that almost 55% of tin is used primarily for solder.

Tin is also used as plating or coating for iron, zinc, lead and steel.  One of the more popular uses of tin are tin-plated steel containers.

Tin is also combined with other metals to create specific alloys.  Years ago, tin was combined with copper to make bronze.  Alloys that contain tin are also used for wires, brass instruments, and even decorative figures (pewter).

What does this high pricing mean for all our manufacturers and assemblers that use solder as a production material?

Tin-based solders are near their peak pricing now and should experience a slight decrease by the end of 2022.  But, don’t expect the prices to drop that significantly as the demand for tin will remain higher than pre-pandemic levels.  Especially, as mentioned above, with ongoing inflation and the potential for more global unrest.

The best thing you can do is to continue to buy high-quality solder because it lasts longer, is more durable and has a longer shelf-life.