Tin - new application

Tin was traditionally used in tin cans, long since abandoned in favour of aluminium. The benefits of tin is that its a chemically inert mineral easily fashioned into shapes. But its lastest application is for ammunition. Lead has long been used for ammunition, but there is growing environmental opposition to its use. Lead was until recently very cheap, since its no longer used in paints or `leaded` petrol, but while lead-acid battery recycling has placed a dampener on demand, the demand for new cars in China has changed that. But its hard to imagine tin going into ammunition - just base on price differences

Tin $US 9000/tonne
Lead $US 800/tonne

Tin has few suppliers, so its hard to enter the market. Tin mining is dominated by Malaysia, Africa, Thailand, Australia, China?

In Australia, it was only recently that the only tin producer went broke - Marlborough Resources, and in the process bought down alot of local shareholders in the Arthelthan community of NSW. Since then, Bluestone Tin Ltd has been floated. This company is in far better shape than its predecessor Murchison United (MUR). MUR went into administration after the company entered into a number of unfavourable hedging contracts on the $A and tin price. They made a desperate bid for Iberian copper-tin assets in Spain, but failed.

Bluestone controls 4 important tin assets:

1. Renison Bell UG tin mine & processing plant
2. Mt Bischoff OC resource
3. Rentails waste dumps containing 0.45%Sn (NPV of $190mil)
4. Exploration interests in Queensland tin provinces

Free of MUR's financial burdens, Renison Bell is a profitable mine, though reserves are running low. Bluestone is attempting to extend the life of the mine, and will feed Mt Bischoff into the plant in due course, as well as undertaking a regional explorational program. The company is cashed up for this purpose. The Rentails project offers another opportunity, but now is not the time to commission such a large project. I suspect the Rentails project will be developed as a supply substitute for Renison plant when that mine faces closure.

The tin price is well off its highs of $US12,ooo/tonne, now around $US7,500, compared to its lows of $US4,800 a few years ago. LME stockpiles remain low.