Alphamin’s Mpama South project at the Bisie Complex in the Democratic Republic of the Congo (DRC), which is adjacent to the current producing Mpama North mine, will churn out approximately 7,200 tonnes (t) of contained tin per year from 2024, thereby increasing Alphamin’s annual tin production to more than 20,000t.
That is already nearing the 5% mark of global tin production, and with more exploration results at the prolific Bisie Complex showing early signs of even better possibilities, Bisie has certainly grown into the role of being reckoned as one of the top five tin mines in the world.
Despite geopolitical tension and the global economic quagmire in the aftermath of Covid-19, Alphamin stuck to its guns and realized its vision of becoming one of the world’s largest sustainable tin producers in 2022. And all indications are that the mine’s winning streak is far from over.
In fact, the much talked about energy transition couldn’t have come at a better time for Bisie in their preamble to an imminent ramp-up as this phenomenal deposit. Even in its new guise as two separate deposits, Bisie would not give up much in grade. Early drilling results indicate that Mpama South and additional targets drilled on Alphamin’s license areas will deliver similar grades in the region of 3% to 4%, which truly sets the mine apart from any of its current competitors in the international world of tin mining.
A resurgent tin price
Geopolitics and the great energy debate have certainly counted in Alphamin’s favour, as the tin price has shown exceptional resilience and renewed verve in the wake of Covid-19 and at a time when the Ukraine crisis has put the cat amongst the pigeons in the European energy space.
The sudden thirst for renewable energy solutions (and especially solar panels), and the long waiting lists for Electric Vehicles (EVs) and all sorts of electronic devices, have given tin, which for a long time was believed to have become redundant, a new life.
And with Environmental, Social and Governance (ESG) issues taking center stage during most mining conversations, utilizing tin in its new form as a green solution, will be a feather in the cap for any technology focussed company.
Tin’s uses in electronics, and in renewable energy solutions are forecast to increase double-fold during the next decade as the globe moves away from fossil fuels and enters a brand new normal, where climate change, green technology, and net-zero emissions will be pursued relentlessly by more socially and environmentally aware investors and venture capitalists.
As a result, a tin supply cliff is looming large as several prime operations around the world flounder in the face of geopolitical tension, logistic and supply chain challenges, operational difficulties, sky-high input costs, and the perpetual energy crisis across the world.
Not many new tin mines have started supplying the market recently, and although a few promising prospects are in the pipeline, there are not enough greenfield exploration and development projects to close the widening demand/supply gap soon.
These market forces will inevitably push the tin price further into green territory. With Bisie on the verge of upping the ante when Mpama South comes online, the results may be better than what even the most optimistic analyst predicts for 2023.
Bisie’s bumper 2022
Bisie had a bumper in 2022 under extremely difficult macroeconomic conditions. With most of the teething problems and bottlenecks that pestered the early-stage operations now well and truly behind it, the mines’ output has been consistent as it gradually ramped up towards maximum capacity over the past three years.
Alphamin produced more tin than stated in the market guidance during the third quarter of 2022. The contained tin production of 3,139 tonnes was in line with the previous quarter and above market guidance of 3,000 tonnes.
A highly mineralized area underground, not previously included in the mineral resource or mine plan due to its structurally complex nature, was successfully mined and processed during the quarter.
This area delivered ore at good tin grades but contained high levels of sulphides which impacted processing recoveries. Despite a few hick-ups, Bisie continued supplying tin to an ever-expanding market as the applications of tin in the transitional economy increased.
Refined tin used more in 2022
The eighteenth annual survey of tin users carried out by the International Tin Association (ITA) estimated that refined tin use in 2021 increased 7.6% to 389,500 tonnes with a strong recovery to pre-trade war highs.
However, estimates showed expected 2022 growth stalling below previous forecasts of 3-4% towards -0.6%. High inflation unexpectedly impacted demand in H2.
According to Alphamin, global tin supply is likely to be constrained during the next five years while demand for tin is expected to increase. Therefore, the anticipated production expansion from the development of the Mpama South deposit remains a priority.
Most of this demand will, of course, be driven by the predicted boom in demand for tin on the back of the energy crisis. Tin is a vital ingredient in solar energy, electric vehicles, and other future technologies.
Unprecedented opportunities in tin
Most analysts predict that demand for tin will surge as the technology supercycle brings more and more opportunities for the tin industry.
Dr. Jeremy Pearce, Head of Market Intelligence & Communications at the International Tin Association (ITA) said during the recent annual ITA’s Investing in Tin Seminar, that the sector will need to adapt rapidly to meet increased demand as the role of tin in enabling the energy transition and digitization becomes more obvious.
“During the event, ITA previewed first stage results of its TIN2030 initiative. This industry vision to 2030 looks at the sector through the lens of macroeconomic influences, growing sustainability pressures and opportunities, and the role of technology.
It concludes with a wake-up call to the crucial role of tin, for example as solder – the glue that holds together all electronic and electrical infrastructures.
As the awareness of tin’s importance grows, so too will the need to secure supply. Pearce highlighted the scale of new investment required to meet the expected surge in demand. It estimates that $1.4 billion is needed to deliver 50,000 tpa more tin by 2030.
“This represents a huge opportunity for investors, allowing the tin sector to build a better future for all,” says Pearce.
Tin in a buoyant solar market
With a rapidly expanding renewable energy sector, the role of tin in the solar industry, especially, has been in the spotlight recently.
Tin is a crucial part of solar power infrastructure. Solar panels are formed of many individual solar cells, connected by “solar ribbon”. This ribbon is a copper wire, coated in a thin layer of tin solder. The ribbon carries the charge to the edge of the panel, where it feeds into junction boxes. This electrical system also requires solder connections – as does the grid infrastructure.
In a recent report, the ITA estimates that the solar industry will use over 22,000 tonnes of tin in 2022, passing the 20,000-tonne threshold.
“The new estimates come after PV Tech released their PV Manufacturing & Technology Quarterly report, expecting global solar module production in 2022 to increase 45% year-on-year to 310GW – a figure almost 20% higher than ITA’s previous forecast.”
In line with module production, tin use in the industry has been rapid, growing more than six-fold in the past decade.
Growth has been driven by China, dominating production with an estimated 85% market share. The PV industry now makes up 10% of China’s tin use and is already its third-largest end-use sector.
Demand for solar power does not seem likely to slow. Optimistic installation forecasts of 100GW for China this year have been suggested – an 82% YoY increase from an already record-breaking 2021. Perhaps unsurprisingly, a record number of modules were also exported to Europe, exacerbated this year by the drive away from reliance on Russian gas.
According to the ITA forecasts for 2023 vary widely. Longi Green Energy Technology Company, one of the world’s largest solar companies, is expecting China’s installations to reach 150 GW next year, according to Morgan Stanley.
They expect global installations to reach 400-500GW. More conservative global forecasts from BloombergNEF suggest 316GW. Assuming module production follows the same growth pattern, it is not inconceivable that tin use in solar will be the fourth largest end-use by 2025.
Against this backdrop, all eyes will be on Alphamin’s Bisie complex as they ramp up exploration and production at Mpama North and Mpama South next year. The mine is continuing its growth trajectory and will certainly be one of the tin operations to watch in 2023 and beyond.
