Lots of interesting changes over the week, especially in the 2nd half. We have had a bounce, but opportunities remain. Key questions that need to be considered are how much of the economic damage from a rocky tariff rollout is already priced in, how should the potential impact of tariffs on earnings be assessed, and what is your plan for deploying capital in the context of a falling market. Pair this week's Real Asset Chartbook with reading Jeremy Grantham’s “Reinvesting When Terrified” and plan out your strategy for the redeployment of capital.
Underestimating China: As we have written previously, we believe that the age of investing in the context of Geopolitical Naivety has ended. Investors who continue to insist on ignoring the geopolitical and national security dimensions of every aspect of the economy do not understand the current investment environment. This article highlights the importance of having clear eyes about the strengths and weaknesses of China and the United States, and, although not explicit, is an indictment of the current administration's isolationism and failure to engage thoughtfully with allies.
It is clear to us that US allies have taken advantage of the US security structure, but it is also clear that democracies will either “hang together, or we will hang separately” when confronted with a challenge like China. Our allies need to step it up, but so do we; we can all be better and should strive to do so.
The strength of the US and our allies will be greater if they are collectively led to superior outcomes instead of bullied into change. No one likes to be told what to do, especially not when it occurs at gunpoint (metaphorical or otherwise). Execution matters, and how the US manages a transition from being unchallenged in political, economic, and security spheres to an era in which a larger peer can challenge the US in all these spheres will be critical. We should neither look to confront that challenge alone nor treat our allies as if we can.
Oxford Instituted For Energy Studies - 2025 EVs and Battery Supply Chain Issues and Impacts (Issue 144): The Oxford Institute For Energy Studies is a must follow organization for anyone invested in energy and the evolving energy landscape. In this issue of the Institutes quarterly journal are several deep dives on different aspects of the global EV and battery supply chains in the context of changing geopoliticals and trade structures.
Tariff Reading…Could Not Help Myself
Trade Wars With Trade Deficits: Mr. Miran cites this paper in his remarks above but glosses over the essential details. At its core, this paper suggests a behavioral reality not captured by most economic models, that countries with large deficits are like companies that have borrowed so much from a bank that the bank now has an interest in the survival of the business. Put another way, if Country B’s economy depends on selling to Country A, Country A has a degree of influence on Country B that traditional economic models fail to capture. It follows that in certain circumstances, tariffs might benefit Country A as a tool for exerting economic rebalancing pressure on Country B.
The paper's details are essential. It finds that how the tariffs are implemented and at what rate is vital to determining the outcome. In the case of US-China relations, the optimal tariff ranges from 7% to 16%. Furthermore, sector-specific tariffs would be even more optimal. Additionally, the authors note that their models evaluate trade dynamics within a static framework when they are dynamic phenomena. As the authors themselves highlight, this methodological issue may limit the applicability of their findings.
The idea that thoughtful use of tariffs can be benficial strikes us a the type of common sense often lost of free trade ideologes, at the same time we find little of what the current administration is doing to be supported by the conclusions of this paper.
A Very Bad Idea: An Op-Ed written by two Economists that pairs well with the “Trade Was With Trade Deficits” paper, and whose work was also cited by Miran (paper in which Miran cited work linked to below). In this op-ed, the authors discuss the importance of the dynamic quality of trade relationships.
In the “Trade Wars with Trade Deficits” paper, the authors are searching for the optimal tariff in the form of a Nash Equilibrium, the solution to a non-cooperative game where no players gain by changing their strategy. As the authors note, this approach's shortcoming is the static nature of that question and answer. In this op-ed, the authors try to convey the challenges of applying the concept of optimal tariff in a dynamic environment rather than a static one.
A Users Guide to Restructuring the Global Trading System: Steven Miran’s Applican for the CEA Chairman Job.
US-Uzbekistan MoU Seeking to Expand US Investment in Uzbek mining
What follows is an excerpt from our latest long-form report: Tin and Turmoil. This excerpt provides an overview of Massif Capital’s outlook for the tin market for the next five to ten years.
The global tin market is entering a significant transition characterized by tightening supplies and growing demand from emerging technologies. As of early 2025, the tin market has shown considerable resilience, with LME prices rising 13.87% through 2024 and reaching $38,000/mt by April 2025. This price strength persists partly because global refined tin production declined YoY by 2.7% to 371,200 tons in 2024, primarily due to supply disruptions in key producing regions. The market appears to be pricing in both near-term supply constraints and anticipated demand growth, with a roughly 74% probability that supply deficits will persist through the middle of the decade.
The current supply/demand imbalance reflects a market increasingly susceptible to structural deficits. Global tin consumption is estimated at 429,000 tons in 2025 and is projected to reach approximately 488,000 tons by 2030, representing a CAGR of 2.59%. However, this modest growth rate understates the potential supply challenges ahead. Industry analysts have identified a lack of significant new mining projects in the development pipeline, with the International Tin Association (ITA) forecasting only 11 new projects and one expansion potentially commissioned by 2030. The follow-through on those projects will be more limited than expected. This project pipeline is a critical vulnerability in the supply chain but a positive for the restart of Bisie. Even if these projects all go into production, the market will struggle to meet conservative demand growth projections of 3-4% annually, creating a high probability of persistent supply deficits through 2030.
Production constraints within existing operations are another significant challenge for global tin supplies. Since 1985, only four new tin mines have entered production, while leading tin-producing nations have exhausted their near-surface high-grade deposits.7 These dynamics have led to declining ore grades, deeper mining operations, and higher production costs across the industry. Geographic concentration compounds the situation risk, with approximately 63% of global refined tin originating from just ten smelters in 2024.8 Indonesia’s tin industry illustrates these challenges, with national refined tin production falling 30.7% in 2024 amid investigations into alleged historical irregularities. Meanwhile, Myanmar’s ongoing mining suspension in Wa State has disrupted concentrate supply to Chinese smelters.
The new project pipeline shows limited capacity to address potential supply shortfalls in the next five years. While most projects target production by 2030, all face significant hurdles, including financing constraints, permitting challenges, and technical complexities. The market faces a structural deficit caused by decades of underinvestment during periods of low prices, creating a situation where even if all currently identified projects reach production, a supply gap of approximately 50,000 tons annually may emerge by 2030. The probability that new supply will materialize on schedule is low, given historical delays in bringing new mining projects online and increasing ESG and permitting pressures extending development timelines.
The geographic concentration of tin production is both a risk and a potential opportunity in the coming years. China dominates the market as the largest producer (30% of global supply) and consumer (47% of global demand) despite declining tin production over the past 15 years. Indonesia’s policies aimed at moving downstream in tin production by potentially limiting exports could further disrupt established supply chains. Meanwhile, Europe and North America seek to diversify supply sources away from Asia, creating opportunities for producers in alternative jurisdictions, particularly in Latin America and Africa. This diversification drive has a moderate probability of successfully setting up new supply hubs over the next five years.
Recycling and secondary tin supply present a promising avenue for addressing potential shortfalls. In 2024, global secondary supply grew by 6.8% to reach a record high, with robust growth of 14.9% in China. The recycling input rate reached 33.1% globally in 2022, reflecting major manufacturers’ increasing investment in recycling technologies and infrastructure. This trend will accelerate, with a high probability that secondary supply will grow at 5-7% annually over the next five years, particularly in regions with strong sustainability initiatives and circular economy frameworks. However, secondary supply growth ex-China declined by 3.4% in 2024, highlighting regional disparities in recycling capacity that could limit its overall impact on addressing supply constraints.
Demand drivers for tin are increasingly diverse, extending beyond traditional applications into high-growth technology sectors. While soldering for electronics is still the primary use (accounting for approximately 50% of demand), emerging applications in renewable energy and electric mobility are creating new demand vectors. Electric vehicles use approximately three times more tin (1,200g) than conventional vehicles (400g), while solar panels need tin coatings that further boost demand. Additionally, the growth of AI, robotics, and IoT technologies creates expanded markets for tin-based components. These factors collectively suggest a high probability (approximately 85%) that demand growth will exceed the historical rate of 1-2% annually, potentially reaching 3-4% growth through 2030.
The price outlook for tin appears bullish over the medium term, with significant upside potential through 2030. While short-term volatility is likely, mainly as Indonesian shipments potentially increase from April 2025 and Myanmar potentially restarts mining operations, the structural supply-demand imbalance suggests sustained price support. Current prices around $35,000 per metric ton could increase by 25-50% by 2030 if projected supply deficits materialize, with BMI Research projecting prices potentially reaching $45,000 by 2033. However, price sensitivity to macroeconomic factors and potential demand destruction at elevated prices introduce uncertainty, suggesting a moderate probability of sustained price appreciation above $35,000 per metric ton through 2028.
Geopolitical factors will increasingly influence tin supply dynamics over the next five years. Indonesia’s investigation into historical irregularities in the tin trade has already disrupted exports, while the country’s strategic ambitions to develop downstream processing capabilities could permanently alter global trade flows. Similarly, resource nationalism trends among producing countries looking to capture more value from their mineral resources may introduce additional barriers to international tin trade. Events such as the protests in Peru affecting Minsur operations and Bolivia’s EM Vinto facing coal sourcing difficulties highlight the supply chain’s vulnerability to political and social disruptions. These factors suggest a high probability that geopolitical considerations will become increasingly important determinants of tin supply security.
The long-term structural outlook for tin supplies beyond the five-year horizon appears challenging without significant investment in new production capacity. Current projections indicate that tin demand could double over the next 20 years, driven by electronics, renewable energy, and electric vehicle growth. Meeting this demand will require substantial new mine development and expanded recycling infrastructure. With total market demand for refined tin potentially exceeding 515,000 tons by 2030, and limited new production coming online, the market faces a significant probability of transitioning from periodic deficits to persistent structural shortages unless investment in new production accelerates substantially. This outlook suggests that tin will likely remain a critical material with increasing strategic importance to technology and energy transition supply chains through the remainder of the decade, a favorable backdrop for a restart of Bisie.
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