1. Supply shortages in tin mine supply…
…and its effect on the global electronics industry
John P. Sykes, Director, Greenfields Research Ltd (on behalf of ITRI Ltd)

2. Supply shortages in tin mine supply
Contents
1 Demand: Tin solder not tin cans
2 Prices: Highest since 1980s ITC Tin Crisis
3 Supply problem: costly alluvial production
4 Supply problem: decline in Asia
5 Supply problem: dependent on other riches
6 Supply problem: dealing with capital costs
7 Conclusions: new mine supply required!

3. Supply shortages in tin mine supply
Demand: Tin solder not tin cans
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

4. Demand: Tin solders not tin cans
2010: solder is +50% of demand 1970s: tinplate is ~40% of demand
Copyright: Greenfields Research & ITRI; Data: ITRI

5. China dominates solder demand
Tin Consumption (2009)
Others: 26,600t (8%)
Glass: 7,300t (2%)
Brass/Bronze: 18,300t
(6%) China: 94,400t
(30% of tin &
55% of solder)
Chemicals: 42,600t Solder:
(13%)
171,100t (54%)
ROW: 76,700t
(24% of tin &
45% of solder)
Tinplate: 54,200t (17%)
Copyright: Greenfields Research & ITRI; Data: ITRI

6. Supply shortages in tin mine supply
Prices: Highest since 1980s ITC Tin
Crisis
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

7. Tin prices are at 30-year highs
Long-term tin price history Tin price histogram 1900-2011
US$/tonne, inflation adjusted 2010 prices Price range, $000/tonne, 2010 real terms
40,000 60
Number of years in each price band
35,000
50
30,000 Prices at 30 year highs Recent prices
40 mainly is this
25,000 range
20,000 30
15,000
20
10,000
10
5,000
0 0
1900 1920 1940 1960 1980 2000 0 to 5 5 to 10 to 15 to 20 to 25 to 30 to 35 to
10 15 20 25 30 35 40
Copyright: Greenfields Research & ITRI; Data: ITRI

8. Lead to tin solder substitution has
driven demand & prices
Lead-free solder as a % of global shipments
Lead-free solder Lead solder
100%
90%
80% Conversion to tin
solder drove tin
70% prices
60%
50%
40%
30%
20%
10%
Copyright: Greenfields Research & ITRI; Data: IPC
0%
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

9. Weak supply now looks to be the
driver of prices
Tin supply demand balance (Kt) Tin supply demand growth (%)
Refined Supply Mine Supply Refined Demand Refined Demand Refined Supply Mine Supply
375.0 12.5%
10.0% Supply weakness
350.0 7.5% driving prices
5.0%
325.0
2.5%
0.0%
300.0
-2.5%
-5.0% Demand strength
275.0 Demand strength Supply weakness
driving prices
driving prices driving prices -7.5%
250.0
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Copyright: Greenfields Research & ITRI; Data: ITRI

10. Supply shortages in tin mine supply
Supply problem: Costly alluvial
production
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

11. Alluvial and artisanal important for tin
mining in contrast to other base metals
Copyright & Images:
Greenfields
Research

12. Unregulated alluvial and artisanal
mining occurs in short cycles
Global tin production (Kt) Index of alluvial mining booms
350.0 Malaysia 1958-1987 Thailand 1962-1991
Brazil 1977-2006 Indonesia 1992-20112
300.0 Other Indonesia 2012-2017???
Africa
250.0 600.0
CIS/USSR
Australia 500.0
200.0
?
Bolivia 400.0
?
150.0 Brazil
300.0
?
Peru
100.0 Thailand 200.0
Malaysia 100.0
50.0
Indonesia
0.0
China
0.0
1970
1973
1976
1979
1982
1985
1988
1991
1994
1997
2000
2003
2006
2009
2012
Copyright: Greenfields Research & ITRI; Data: ITRI

13. Hard or soft rock: Grade is king!
2015, Theoretical Net of By-Product Cash Costs
Mining Other Approximate grade of
25,000
S.E. Asian alluvial ores
20,000
US$/tonne
15,000
10,000
5,000
0
1.0kg/m3 0.8kg/m3 0.6kg/m3 0.4kg/m3 0.2kg/m3
Theoretical change in cost due to changes in ore grade for a
primary tin, alluvial mine in Indonesia, producing 7,500 tonnes of tin
Copyright: Greenfields Research & ITRI; Data: ITRI
per year, from a team of gravel pumps, with a 100% recovery.

14. Hard rock mining costs becoming
competitive with alluvial mining
2015, Theoretical Net of By-Product Cash Costs
Mining Processing Other Approximate grade of
25,000
new hard rock projects
20,000
US$/tonne
15,000
10,000
5,000
0
OP 2.0% UG 4.0% OP 1.5% UG 3.0% OP 1.0% UG 2.0% OP 0.5% UG 1.0%
Open pit mine is a theoretical primary tin, open pit mine in Australia, producing
7,500 tonnes of tin per year, with a processing recovery of 75%.
Copyright: Greenfields Research & ITRI; Data: ITRI Underground mine is a theoretical primary tin, underground mine in Australia,
producing 7,500 tonnes of tin per year, with a processing recovery of 75%.

15. Hard or soft rock: Grade is king!
2015, Theoretical Net of By-Product Cash Costs
Fuel Electricity Labour Other
100%
Vulnerable to labour
% breakdown of cost
80% costs
inputs
60%
40%
20%
0%
Alluvial Open Pit Underground
Theoretical cost breakdown for a primary tin, alluvial mine in Indonesia grading 0.2kg/m3, producing
7,500 tonnes of tin per year, from a team of gravel pumps, with a 100% recovery.
Vulnerable to fuel costs
Theoretical cost breakdown for a primary tin, underground mine in Australia grading 1.0%,
producing 7,500 tonnes of tin per year, with a 75% recovery.
Copyright: Greenfields Research & ITRI; Data: ITRI Theoretical cost breakdown for a primary tin, open pit mine in Australia grading 0.5%,
producing 7,500 tonnes of tin per year, with a 75% recovery.

16. Supply shortages in tin mine supply
Supply problem: Decline in Asia
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

17. Asian countries dominate production,
very few developed world tin miners
Russia
(0.2%)
World Tin Mine Production (2012 est.)
Mongolia
Portugal (<0.1%) (<0.1%)
Peru Egypt (0.1%)
(9.4%)
Nigeria (0.6%) DR Congo
(2.6%) China
Rwanda Myanmar (0.7%)
(1.4%)
(34.5%)
Thailand (0.1%)
Burundi (<0.1%)
Malaysia Laos (0.4%) Vietnam (1.2%)
(1.2%)
Bolivia (6.9%)
Brazil (3.8%) Indonesia
Copyright: Greenfields Research & ITRI; Data: ITRI
Australia
(34.5%) (2.3%)

18. Developed versus developing world
labour rates versus fuel prices?
2011, GNI Per Capita (US$) 2007-11 GNI Per Capita
CAGR (%)
60,000 14.0%
Developed world …but developing
50,000 12.0%
labour costs are world labour costs
higher… 10.0% are rising quickly
40,000
8.0%
30,000
6.0%
20,000
4.0%
10,000 2.0%
0 0.0%
Copyright: Greenfields Research & ITRI; Data: World Bank

19. Developed nations a safer investment,
important for large capital projects
Country Ranking (of 181) Country Ranking (of 181)
Canada 4th Peru 56th
Australia 5th - -
- - China 71st
USA 10th Brazil 72nd
- - - -
Germany 20th Indonesia 111th
- - - -
UK 25th Bolivia 125th
- - - -
Spain 27th DR Congo 159th
Rankings based on Greenfields Research’s proprietary mining political risk ranking system. The ranking system correlates economic data sets
that cover most of the world’s countries (such as the Transparency International Corruption Index, the World Bank Doing Business dataset and
GDP/land area) with well known mining industry political risk surveys, including the Fraser Institute, Behre Dolbear and ResourceStocks, to get
a system which ranks all countries by their suitability for mining, not just those in the mining industry surveys.
Copyright: Greenfields Research & ITRI; Data: Greenfields Research

20. Exchange rates important, a stronger
Rupiah raises marginal costs
Exchange rates (to US dollar)
indexed to 2006
Indonesian Rupiah (IDR) Chinese Renminbi (CYN)
Bolivian Bolivano (BOB) Brazilian Real (BRL)
Australian Dollar (AUD)
1.15
1.10
Weaker
1.05
1.00
0.95
0.90 Stronger
0.85
0.80
0.75
Indonesian Rupiah affects
0.70 marginal costs in tin. A
2006 2007 2008 2009 2010 2011
stronger Rupiah means
Copyright: Greenfields Research & ITRI; Data: ITRI
higher long term tin prices

21. Asian mining in decline, replaced by
developed world production
UK (0.1%) World Tin Mine Production (2016 est.) Russia (0.9%)
Germany Mongolia
Canada (0.1%) Morocco Kazakhstan
(1.2%) (0.4%)
(2.1%) (1.8%)
Portugal (<0.1%) Spain
(0.3%)
Egypt
(0.7%) China
Peru Myanmar
(10.6%)
DR Congo (3.0%) (3.1%) (26.2%)
Nigeria (0.5%) Laos (0.4%)
Rwanda (1.2%)
Thailand (>0.1%) Vietnam (1.1%)
Malaysia (2.9%)
Burundi (<0.1%)
South Africa (0.5%)
Bolivia Indonesia Australia
(7.5%)
Copyright: Greenfields Research & ITRI; Data: ITRI Brazil (4.8%) (22.0%) (8.5%)

22. Supply shortages in tin mine supply
Supply problem: Dependent on
other riches
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

23. Tin mining is dependent on a wide
variety of by-products
World Tin Mine By-Products (2012 est.)
Antimony Copper Gallium Indium Lead
China Australia & China China China China
Niobium Silver Tantalum Tungsten Zinc
Brazil, Burundi, China Burundi, Congo, Egypt, Mongolia, Bolivia, China
Nigeria Rwanda Myanmar
Copyright: Greenfields Research & ITRI; Data: ITRI; Images: Shutterstock, www.csksg.com, www.tradekorea.com, www.cdves.com, American
Elements, Wikipedia

24. Tin industry uneconomic without by-
products
2016 estimates of revenue shares for tin producing
mines and mine projects
Tin Aggregates Copper Iron Ore Mineral Sands Niobium Silver Tantalum Tungsten Lead/Zinc
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
Copyright: Greenfields Research & ITRI; Data: ITRI

25. Tin mining will become more
dependent on by-products
World Tin Mine By-Products (2017 est.)
Indium Iron Ore Lithium
Copper Gallium Lead
Aggregates Antimony Australia, Canada, Australia, Czech Rep.
Australia, China, China, China
Malaysia China China, Germany Kazakhstan
Germany, Germany
Kazakhstan,
Peru, UK
Molybdenum Niobium Silver Tantalum Titanium Zirconium
Tungsten Zinc
Canada Brazil, Australia, Australia, Burundi, Kazakhstan, Brazil
Australia, Canada, Australia,
Burundi, Canada, Congo, Egypt, Malaysia Egypt, Kazakhstan, Bolivia,
Nigeria China, Kazakhstan, Mongolia, Myanmar, Canada, China,
Kazakhstan, Rwanda Portugal, Russia, Germany, UK,
USA
Spain, UK, USA USA
Copyright: Greenfields Research & ITRI; Data: ITRI; Images: Shutterstock, www.csksg.com, www.tradekorea.com, www.cdves.com, American
Elements, Wikipedia, www.made-in-china.com; www.images-of-elements.com

26. Supply shortages in tin mine supply
Supply problem: Dealing with
capital costs
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

27. Dominated by small, private
companies and state miners
~39,400t, 13.6%, ~32,000t, 11.0%, ~27,200t, 9.4%,
State/Public, Indonesia Private/Public, Peru State/Public, China
~11,600t, 4.0%, ~10,500t, 3.6%, ~7,125t, 2.5%, Public,
State, Bolivia Private, China Malaysia/Indonesia
~3,500t, 1.2%, State, ~3,200t, 1.1%, Public, ~2,500t, 0.8%, Private, ~2,000t, 0.7%, Co-op,
Vietnam Australia China Brazil
Copyright: Greenfields Research & ITRI; Data: ITRI; Images: Company websites, ITRI, Wikipedia

28. Substantial investment required in new
tin supply, bigger companies required
Company Project Capex Capacity Capex Source
(US$M) (t/y Sn) (US$/t/y)
Consolidated Tin Mines Mt Garnet 124.0 3,050 40,700 Scoping 2010
Kasbah Resources Achmmach 167.0 6,880 24,300 Pre-Feasibility 2012
Metals X Rentails 173.2 5,300 32,700 Feasibility 2009
Stellar Resources Heemskirk 108.0 3,900 27,700 Scoping 2011
Venture Minerals Mount Lindsay 144.6* 3,700 39,100 PFS 2011
Total & average 716.8 22,830 31,397
 Total new mine supply required 2011-15: 70,000t/y
 Average capital cost per tonne new capacity: $31,400
 Total investment required in new supply: $2.2 billion
Copyright: Greenfields Research & ITRI; Data: ITRI * Mount Lindsay is a tin-tungsten-magnetite project. The tungsten plant in particular greatly adds to capital costs.

29. Supply shortages in tin mine supply
Conclusions: New tin mine supply
needed
Section 1 Section 2 Section 3 Section 4 Section 5 Section 6 Section 7

30. High marginal tin costs, mean high
long term prices
Hard rock High and rising
Alluvial marginal costs dictate
long term prices –
Artisanal (non-alluvial) currently ~$25,000/t,
rising to $40,000/t ???
Copyright: Greenfields Research & ITRI; Data: ITRI

31. Generally rising costs mean that even
floor prices are quite high
Recent price lows versus marginal cash costs
Copper Zinc Nickel Tin
2011 Cash Costs (US$/tonne) Floor (100%)
Median 2,250 922 6,505 8,686 seems to be about
¾ the marginal
10th Decile 4,000 1,530 16,048 13,327
cost for base
metals, currently
Recent price history (monthly average LME 3-months prices)
about $18,000/t,
GFC low 3,108 1,119 9,791 10,465 rising to about
2011 peak 9,854 2,489 28,266 32,464 $25,000/t ???
GFC low versus:
Median 138% 121% 151% 120%
10th Decile 78% 73% 61% 79%
Copyright: Greenfields Research & ITRI; Data: ITRI, Barclays Capital, Brook Hunt

32. Alternative price forecasts are all high
Price history and forecast scenarios (US$/tonne)
Historical price (real 2010) Central Forecast
Double Dip Scenario Robust Growth Scenario
50,000
45,000 High demand growth,
significant new supply Marginal cost: $40,000/t ???
40,000
required, prices will trends
35,000 towards a high & rising Future price
30,000 marginal cost range: $20,000-
25,000 40,000/t ???
20,000 Floor price: $20,000/t ???
15,000
No demand growth, new
10,000
supply will struggle to
5,000 come on stream, prices will
0 trend towards a high &
rising floor price
Copyright: Greenfields Research & ITRI; Data: ITRI

33. Plenty of projects in the pipeline: time
and money needed to develop them
1 at feasibility stage 90Kt at feasibility stage
4 at scoping
stage 310Kt at
scoping 824Kt as compliant
10 with compliant stage resources
resources
~60 with historical
resources
~3.2Mt as historical
resources
~130 known projects
~4.8Mt of estimated reserves
(USGS)
Copyright: Greenfields Research & ITRI; Data: ITRI, Greenfields Research, USGS, Infomine, company websites

34. New supply will have to enter the cost
curve lower than marginal alluvials
Operating (2012) These projects
Brownfields currently not
Greenfields economic
New projects
Greyfields need to enter the
cost curve here!
Copyright: Greenfields Research & ITRI; Data: ITRI
Data: ITRI/Greenfields Research

35. Supply shortages in tin mine supply
Conclusion
1 Tin is an electronic metal driven by solder demand.
2 30-year price highs are effecting the electronics industry.
3 Alluvial tin supply falling to be replaced by hard rock mining.
4 Declining Asian mining, new supply from elsewhere in the world.
5 Increasing reliance on by-products as grades decline.
6 Future supply will have much higher capital costs.
7 High medium term prices, will encourage new supply on-stream

36. Contact Details:
 John P. Sykes
 Director, Greenfields Research
 john.sykes@greenfieldsresearch.com
 www.greenfieldsresearch.com
Today’s reference:
 ITRI Tin Industry Review 2011
 Peter Kettle
 Manager, Statistics & Market Studies
 peter.kettle@itri.co.uk
 www.itri.co.uk