(Updates prices, adds China tin output)
LONDON, June 11 (Reuters) - Tin prices rose to their highest in more than a decade on Friday as expectations of severe shortages due to supply and shipping disruptions created by COVID-19 restrictions fuelled another speculative buying frenzy.
Benchmark tin on the London Metal Exchange was up 1.1% at $31,545 a tonne at 1557 GMT.
Prices of the soldering metal earlier touched $31,620 a tonne, the highest since May 2011.
“The story of deficits isn’t going away. There are lockdowns in Asia affecting supply and demand is still rising,” said a physical tin trader. “Lots of people are looking for material on the spot market and on the exchange.”
TIN: Global tin supplies last year amounted to around 330,000 tonnes, a significant drop from about 360,000 tonnes in 2019. Supplies are under pressure again this year from lockdowns.
MALAYSIA: Fresh purchases of tin this week on the LME were triggered by Malaysia Smelting Corporation, the world’s third-biggest refined tin maker, declaring force majeure on deliveries to customers.
CHINA: China’s refined tin output at 14,036 tonnes in May was down 8.2% from April.
SHIPPING: Congestion at container shipping ports in southern China is worsening as authorities step up disinfection measures amid a flare-up in COVID-19 cases, causing the biggest backlog since at least 2019.
PREMIUMS: The cost of tin on the physical market is typically the LME price plus a premium, which in the United States is at $2,700 a tonne compared with around $600 a tonne at the end of last year.
The premium in Europe at about $1,200 a tonne compared with around $400 at the end of December.
STOCKS: Historically low tin stocks in LME registered warehouses MSNSTX-TOTAL have reinforced the idea of scarcity and created a large premium for the cash over the three-month tin contract CMSN0-3 this year.
OTHER METALS: Industrial metals overall were boosted by a lower U.S. currency, which makes dollar-priced commodities cheaper for holder of other currencies.
Copper was up 1% at $9,992 a tonne, aluminium slipped 0.5% to $2,462.5, zinc added 1.6% to $3,044, lead gained 1.8% to $2,215 and nickel ceded 0.3% to $18,235. (Reporting by Pratima Desai Editing by Chizu Nomiyama and David Evans)