Market Nuggets: BNP Paribas: 'The Sky Has Not Fallen For Tin'...

Market Nuggets: BNP Paribas: 'The Sky Has Not Fallen For Tin'

Friday October 26, 2012 10:03 AM

BNP Paribas says "the sky has not fallen for tin" despite recent weakness. Tin remains the best-performing base metal of 2012 so far but has lost 12% in a correction since the early October high. Demand may end up weaker than BNP thought in July; however, production is also falling short of expectations, says senior metals strategist Stephen Briggs.

The bank still expects a supply deficit of at least 10,000 metric tons this year. "We are still positive about tin's price prospects," Briggs says. "It will remain vulnerable to sell-offs while demand is still weak but should become less so as 2013 unfolds.

We retain our forecast 2013 average of USD 25,500/t. We are now less enamored of our long tin, short nickel recommendation, but mainly because nickel's outlook has improved due to mounting production problems."

As of 9:30 a.m. EDT, tin was trading at $20,050 on the London Metal Exchange.