Tin

Written by Mark Fields, President & CEO

Geodex’s exploration strategy for some years has been focused on New Brunswick and the geologic potential it provides. Tin is one of the metals that occur in New Brunswick and Geodex has explored for it at its Mt. Pleasant West project for example. Tin has also been the focus at our South Dungarvon project, which we staked a couple of years ago. We have had success advancing South Dungarvon through a combination of prospecting and soil sampling, followed by a small drill program this spring. We plan on doing another drill program there shortly (see our recent news releases for more detail) to follow up on the success we had in the spring drilling.

I thought it would be useful to provide some background information on tin, which is seen as a commodity with global supply concerns.

The use of tin has been traced back to the Bronze Age, so it was one of the earliest metals used by man to manufacture items. It is an important commodity today and is traded on the London Metals Exchange, the LME. The breakdown of current uses is described in the graph below.

Source: Wikipedia

Currently production comes primarily from mines in China, Southeast Asia and South America.

Tin prices have been reasonably stable compared to many metal prices. The exceptions have been in the 1970’s when inflation had a sharp impact on many commodities and also in 1985 when the then existing International Tin Council collapsed.  Most of the trading today occurs on the LME and the prices, as per the graph below, have been demonstrating cycles that are not overly skewed to the high or low end.

Source: Infomine

Current market watchers cite a concern of a tin supply deficit occurring over the next few years. This is based on steadily increasing demand coupled with limited mine expansion capability aggravated by decreases in Indonesian exports due to government legislation.

As an explorationist, Geodex’s approach is always to look for the most attractive discovery opportunities. Simultaneously we need to be aware of the market conditions of the commodities we explore for as this impacts both investor and potential strategic partner interest. Based upon the current situation we believe South Dungarvon provides both good discovery potential and would also attract good attention from the tin industry.