MALAYSIA SMELTING CORPORATION Sept 24 (Reuters) - Tin prices hit record highs on Friday as inventories fell in exchange warehouses, although looming U.S. rate hikes and concerns over debt-ridden China Evergrande kept a lid on gains.
The most-traded October tin contract on the Shanghai Futures Exchange jumped as much as 4.8% to a record 287,960 yuan ($44,545.51) a tonne. The contract has leapt 90% so far this year to be the best performing base metal on ShFE.
Three-month tin on the London Metal Exchange also hit a historic high of $36,500 a tonne, having gained 79% so far in 2021.
"It's a good time, especially for producers," a tin trader said, adding that a production issue at Malaysia Smelting Corporation, the world's third-biggest refined tin maker, was a major factor this year.
Prices can go up more based on supply and demand, although a rate hike by the U.S. Federal Reserve will likely suppress the rally, the trader said.
Tin inventories in LME warehouses
The global tin market deficit is expected to rise to 12,700 tonnes in 2022 from 10,200 tonnes this year, the International Tin Association said in June. Prices for the metal have gone up due to high demand from electronics firms, pandemic-led supply disruptions and historically low inventory levels.
Further gains on Friday were limited as markets watched out for signs of default from property developer China Evergrande , while the U.S. Federal Reserve hinted at a sooner-than-expected rate rise.
FUNDAMENTALS
* LME copper edged up 0.1% to $9,280 a tonne by 0712 GMT, aluminium fell 1.1% to $2,917 a tonne and nickel decreased 1% to $19,160 a tonne.
* ShFE aluminium fell 1.2% to 23,100 yuan a tonne, copper rose 0.6% to 69,250 yuan a tonne, zinc advanced 1.5% to 22,985 yuan a tonne and lead was up 1% at 14,355 yuan a tonne.
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($1 = 6.4644 yuan) (Reporting by Mai Nguyen in Hanoi; Editing by Ramakrishnan M. and Sherry Jacob-Phillips)
