Lessons from Shanghai: China’s booming demand for lead-acid batteries good news for the tin industry

Last month Stellar Resources presented at the 2015 International Tin Forum in Shanghai, one of the biggest industry events of the year.

During the Forum there were many interesting and uplifting presentations from tin professionals and experts, including Tianneng Power, one of the two leading Chinese motive battery producers.

In a detailed presentation, Tianneng Power forecast that China’s lead-acid battery industry – which uses tin to reduce corrosion and increase battery life – will rapidly grow over the next few years. The lead-acid battery is the oldest and one of the most trustworthy types of rechargeable battery, and its large power-to-weight ratio and low cost makes it an attractive prospect for use in electric vehicles – an industry which is booming in the Far East.

Tianneng revealed that battery production in China has risen by 55% in the last three years, attributing this surge to the country’s demand for clean power and travel. Ownership of e-bikes for example, which use lead-acid batteries, has now reached a huge 190 million in China; with 30 million being sold last year alone. The ownership of four-wheeled electric vehicles, also powered by lead-acid batteries, has increased as well: doubling to 400,000 in the last two years.

It’s not just clean vehicles that the Chinese are seeking either – but clean energy as well.

In its presentation Tianneng explained how lead-acid industrial batteries are used to store solar and wind-generated power. As the demand for renewable energy is increasing in China, so is the use and production of tin and the lead-acid industrial battery.

Concluding its presentation, Tianneng predicted that the use of tin in the lead-acid battery industry could increase from almost 12,000 tonnes in 2014 to 17,600 in 2018. This is exciting and positive news for Australian tin explorers and developers such as Stellar Resources, with a premium location giving easy-access to the Chinese market.

Source: Tianneng Power presentation, 2015 ITRI International Tin Forum
Source: Tianneng Power presentation, 2015 ITRI International Tin Forum

Stellar in Shanghai for ITRI International Tin Forum

Last month Stellar Resources attended the 2015 ITRI International Tin Forum in Shanghai, billed as the tin world’s main event of the year.

A record 300+ delegates were in attendance with Stellar at the event between 18 – 20 May, including tin miners, smelters, traders, fabricators and consumers from around the world. The Forum offered international attendees a window into the world’s largest tin market, while providing the Chinese industry with a clear view of trends in global supply, demand and prices.

During the Forum Stellar Resources gave a strong presentation informing attendees about its Heemskirk Tin Project, which is the highest grade undeveloped tin project listed on the ASX. Managing Director Peter Blight enthusiastically explained how Stellar’s project is in a premier position in Australia’s most productive tin field, and how they are poised to embark on a DFS for the Heemskirk project this year with PFS optimisation currently well underway.

ITRI also gave a formal presentation on the main day of the Forum which covered a number of the year’s principal issues, such as imports of ore and concentrates from Myanmar, technology changes in the electronics solders business and rapid growth in newer applications like lead-acid batteries.

The Forum’s key topic of interest was the unexpected increase in the 2014 tin mine production and its subsequent role in the fall in the price of tin, particularly in the second half of the year. While production increases were widespread the single biggest impact came from artisanal production in NE Myanmar.

According to the latest statistics, this production may have peaked in January of this year, however ITRI reported a continued, yet modest, increase of 5,000t year on year in 2015. Discussions at the event suggest that despite this, as high cost producers react to weak tin prices, the resultant cuts in refined production elsewhere should more than offset higher production from Myanmar.

Additional presentations at the Forum showed that demand in the tin market is looking stronger than expected, with above trend growth forecast for 2015 after a strong recovery in 2014. This is good news for developers and explorers such as Stellar Resources, who left the Forum with renewed confidence.

To view the presentation Stellar gave at the 2015 ITRI International Tin Forum, please click here.