The global tin market is under increasing pressure as key mines remain out of production, driving supply shortages and price volatility. Tin (Sn), a critical material in electronics, soldering, and other essential industries, has become the subject of significant interest from major economies, including the United States, which is actively seeking ways to bolster production from recycling. However, one player stands out as a reliable source for the world’s tin needs: Alphamin Resources (TSX.V:AFM), a Tier 1 producer located in the resource-rich Democratic Republic of Congo (DRC). As the company reports strong financial results and continues expanding its operations, it is positioning itself as a leader in a market desperate for stability and growth.
Driving growth in a tight market
Alphamin Resources recently announced its third-quarter financial results, showcasing impressive operational performance amid global tin shortages. The company doubled its interim dividend to C$0.06 per share, driven by robust earnings before interest, taxes, depreciation, and amortization (EBITDA) of $91 million for the quarter. Alphamin’s ability to maintain profitability, even in a challenging market environment, is a testament to its operational efficiency and the high-grade nature of its Mpama North mine, located in one of the richest tin-producing regions globally.
Alphamin is not just resting on its laurels; it is actively expanding its production capabilities. The company recently completed the ramp-up of its Mpama South facility, doubling the size of its overall production capacity. This expansion positions Alphamin to supply approximately 6% of the world’s mined tin. With the tin market showing no signs of easing its supply constraints, Alphamin’s strategic growth comes at a critical time when the world is scrambling for reliable tin producers.
“We are proud to report another quarter of strong financial performance boosted by our recoently completedexpansion,” said Alphamin CEO, Maritz Smith. “As global tin supply remains tight, we are committed to solidifying our position as a leading producer, providing the world with the critical resources needed for technological advancements.”
Source: Core Consultants, February 2024
Supply struggles amid global demand
Tin’s role in modern technology cannot be overstated. It is essential for the production of semiconductors, electric vehicles (EVs), and renewable energy infrastructure, among other critical industries. As the world accelerates its transition to greener energy and smarter technologies, demand for tin is expected to soar. The International Tin Association (ITA) projects that tin demand will outstrip supply in the coming years, with a multi-year bull run in prices already underway. Tin prices have surged as much as 60% in recent years, driven by supply chain disruptions and growing demand for high-tech applications.
The U.S. government is taking note of these supply chain challenges. In a recent move, the U.S. Department of Defense awarded a $19 million grant to a domestic secondary tin producer to ramp up production. This initiative underscores how nations are prioritizing the securing of tin supplies as they race to decouple from international supply chain vulnerabilities. However, with only limited secondary production and recycling capabilities, most of the world’s tin still comes from mining operations.
Europe is also feeling the pressure. Aurubis, a major copper producer, is exploring the recovery of tin from waste processing plants to reduce reliance on primary tin producers. Yet, even with innovative methods like these, the bulk of the world’s tin will still need to come from mining, making Alphamin’s operationeven more crucial.
Source: Statista, ITA
Alphamin Resources’ edge: High-quality resources in a critical location
What sets Alphamin (TSX.V:AFM) apart from other tin producers is the exceptional quality of its deposits. The Mpama North mine has a
high-grade resource, making it one of the most efficient tin mines in operation today. The Company’s results for the third quarter ended September 2024, stated an average ore feed grade of 2.9% Sn. To illustrate just how significant these grades are, the International Tin Association (ITA) wrote a report in 2020 stating that compared to commercially viable deposits of other base metals, tin deposits are generally small. All deposits covered in this study fell within the range of 0.01 – 5% Sn, with ore tonnages less than 1,000 Mt.
As other major producers like Indonesia and Myanmar grapple with reduced output, Alphamin’s consistent production and expansion efforts make it a key player in stabilizing global supply.
The company’s latest production results revealed 4,917 tonnes for the quarter, up 22% from the prior period. This increase was due to the expansion of Mpama South contributing for a full quarter, compared to only running for half the time in the prior quarter. Overall, the company was able to increase tin sales by 71% q.o.q to 5,552 tonnes, including clearing the 600 tonnes sales backlog from the prior period.
| Description | Jun-24 | Sep-24 | % Ch |
| Ore Processed | 166676 | 229107 | 37% |
| Tin Grade Processed | 3.2 | 2.9 | -9% |
| Overall Plant Recovery | 75.4 | 73.4 | -3% |
| Contained Tin Produced | 4028 | 4917 | 22% |
| Contained Tin Sold | 3245 | 5552 | 71% |
| EBITDA | 54242 | 91500 | 69% |
| AISC | 15556 | 15700 | 1% |
| Average Tin Price Achieved ($/t) | 32314 | 31757 | -2% |
The company continues to invest heavily in exploration and resource expansion, with plans to increase its tin reserves and further scale up production. In a market where most producers are struggling to keep up, Alphamin is in the enviable position of having both the resources and the infrastructure to meet growing demand.
Moreover, Alphamin’s focus on sustainability and responsible mining practices aligns with global trends, pushing for more ethical and environmentally friendly resource extraction. As the world becomes more conscious of the environmental and social impacts of mining, Alphamin’s commitment to these principles is likely to play a significant role in maintaining its market leadership.
Future prospects for tin
Looking ahead, the outlook for the tin market remains bullish. Analysts forecast that tin prices will remain elevated due to the persistent supply gap and increasing demand from sectors like renewable energy, electric vehicles, and electronics. According to Trading Economics, tin prices are projected to reach new highs as global supply tightens further, offering lucrative opportunities for producers like Alphamin.
Sucden Financial, in its third quarter 2024 metals outlook, emphasized that tin’s growing importance in the tech revolution will drive long-term demand growth. From 5G infrastructure to autonomous vehicles, tin’s role in facilitating technological advancement cannot be ignored. The fact that tin is a relatively small market compared to other base metals, like copper or aluminium, only intensifies the price impact of any supply shortages.
Alphamin Resources leads the charge in a tin-hungry world
As the world grapples with an ongoing tin supply crunch, Alphamin Resources (TSX.V:AFM) stands at the forefront of the industry. Its high-grade resources, efficient production facilities, and commitment to expanding supply, make it a crucial player in meeting global demand. While other nations and companies scramble to recover tin from secondary sources or increase recycling, Alphamin continues to expand its primary production in one of the most tin-rich regions on the planet.
The company’s strong financial results, growth prospects, and strategic market position offer a compelling case for considering Alphamin as a key player in the future of the tin market. With the global race for critical minerals intensifying, Alphamin Resources is well-positioned to thrive in this rapidly evolving landscape, providing a stable supply of one of the world’s most sought-after metals.
