On 26 November, Minsur’s subsidiary, Minera Latinoamericana (Minlat), signed an agreement to sell its entire stake in the Brazilian subsidiary Taboca to the Chinese trading company China Nonferrous Trade, a subsidiary of China Nonferrous Metal Mining Group (CNMC). This transaction, valued at an estimated US$340M, includes Taboca’s mining and refinery operations. The deal will become effective upon the fulfilment of “certain usual precedent conditions”. 

Minsur is a prominent global producer of tin concentrate and refined tin, with operations in both Peru and Brazil. In Peru, Minsur oversees the San Rafael mine, B2 Tailings plant, and Pisco smelting and refining plant. In 2023, Minsur’s Peruvian operations produced 26.2kt of tin-in-concentrate and 25.4kt of refined tin.  

In Brazil, Taboca manages the Pitinga mining unit, which includes the polymetallic Pitingamine, which has the capacity to produce7.0ktpyof tin-in-concentrate and 4.0ktpy of ferroalloys (including ferroniobium, ferrotantalum, and a ferroniobium–tantalum blend [FeNbTa]), and the Pirapora smelting and refining plant,which has a capacity to produce 7.0ktpy of refined tin. In 2023, Taboca produced 5.6kt of tin-in-concentrate and 4.4kt of ferroalloys. Additionally, the Pirapora plant produced 5.4kt of refined tin. 

According to Project Blue, in 2023, Taboca’s production of tin concentrate and refined tin accounted for approximately 2% of global supply in each respective market.  CNMC, one of the world’s largest copper producers with extensive operations in Zambia, is diversifying its portfolio through this acquisition.

This strategic move will enable CNMC to secure critical supplies of tin, tantalum, and niobium, essential materials for their growing markets. These resources are vital for high-tech industries and electric vehicle technologies, complementing CNMC’s existing copper dominance while addressing strategic market demands.   

What does this deal mean for the Chinese tin, niobium, and tantalum industries? 

Tin 

Tin is a vital material in the electronics industry, particularly as the primary component in solder. Tin solder is essential for bonding metals in a variety of applications, including attaching components to circuit boards.In 2024, the tin market has faced significant raw material supply challenges, driven primarily by disruptions in Myanmar’s Wa State and reduced refined tin exports from Indonesia. Mining at the Man Maw Mine in Wa State has been suspended since August 2023, with only surface ore stockpile processing permitted since September of that year. By mid-2024, these stockpiles were reportedly nearing depletion, as evidenced by the low volumes of ore and concentrate exports from Myanmar. Consequently, tin concentrate production in Myanmar is anticipated to decline sharply this year, as per Project Blue analysis.  In Indonesia, a shift in mining policy at the beginning of 2024 further impacted the tin industry. The transition from an annual to a triennial RKAB (Work Plan and Budget) created a backlog in quota approvals, halting mining activities and delaying export licences. This disruption led to minimal refined tin exports in Q1. While Indonesian exports of unwrought tin and tin products have rebounded since February (reaching 6.4kt in August),a significant volume of these shipments have been directed to China. Nevertheless, Indonesia’s overall refined tin production for 2024 is expected to be significantly lower than in 2023. 

China, the world’s largest producer and consumer of tin, remains heavily dependent on imports of both concentrate to feed domestic smelters and refined tin. In 2023, 73% of China’s tin concentrate imports were shipped from Myanmar, while 71% of its refined tin imports were sourced from Indonesia. However, the mining suspension in Myanmar has caused a shortage of feedstock for Chinese smelters, which are now operating at reduced rates. Consequently, China’s refined tin production is projected to decline in 2024.  The recent deal between CNMC and Minlat could be a strategic move by China to address its supply chain vulnerabilities, securing access to additional tin resources amid the ongoing challenges faced by tin producers.While Brazil accounted for 0.2% of Chinese tin concentrate imports over the last ten years,it also plays a critical role as a key exporter of unwrought tin to the USA, accounting for 8% ofUS unwrought tin imports and ranking in the top five suppliers of unwrought tin to the USA over the last decade.  Furthermore, in September, the US Department of Defense awarded Nathan Trotter & Co., a significantNorth American refined tin importer, US$16.2M via the Defense Production Act Investment (DPAI) programme to establish a domestic facility to build comprehensive capacity for tin smelting, refining, and recycling in Coatesville, Pennsylvania. The USA has not mined or smelted tin since 1993 and1989, respectively; therefore, it relies heavily on tin imports. A potential Chinese takeover, likely involving CNMC redirecting all output for its own use, could injure the US tin industry. 

Niobium 

At Pitinga, Tabocaalso produces ferroniobium (FeNb) from a complex mineralogy which combines columbite and pyrochlore. The mineral also containszircon as well as uranium andthorium, which are removed and processed internally. Taboca produces around 4.0ktpy of alloys, out of which about 2.0ktpy of FeNb(1.1–1.2ktin Nb content at 58%) is produced,most of which is exported to China, withsome volumes also shipped to India and Silmet in Estonia.Taboca aims to increase its production but wouldfirst need to improve its operational mineral processing.   Taboca is a small player in the niobiummarket, with a production share of around 1.5%, dominated by Brazil’s CBMM, CMOC, and Canada’sMagris.   

Tantalum 

Brazil is the second-largest producer of tantalum, with columbite being the main form of tantalum ore mined. However, Taboca extracts pyrochlore, a mineral containing 0–2% tantalum pentoxide. According to Project Blue, the Pirapora plant contributes approximately 5% of the global tantalum supply.  In 2022, the USA took steps to diversify its tantalum supply chain due to national security concerns, imposing restrictions on tantalum imports from China, Russia, Iran, and North Korea. The recent sale of Taboca’s assets to China’s CNMC is unlikely to have an immediate impact. This is because most Brazilian tantalum resources are exported to China as concentrate material, where they are further refined into finished metals and products. 

While the sale is not expected to significantly alter existing tantalum supply chain routes, it may constrain the USA’s future options if it expands restrictions to include tantalum sourced from Chinese-operated facilities. Despite these developments, the USA continues to focus on securing tantalum concentrates from African and Australian sources. 

China’s growing presence in Latin America 

CNMC’s Taboca acquisition is further evidence of China’s rapid expansion into Latin America and Africa through the Belt and Road Initiative. Earlier this month, China’s President Xi inaugurated the Chancay port, located about 80km north of Lima, Peru. The US$1.3Bn project, funded by China, could handle up to 24,000 containers and is expected to become a major trade hub between Latin America and Asia. The new geopolitical environment is prompting China to diversify and expand its trade flows outside developed economies, which are increasingly adding trade barriers. Africa and Latin America are key targets for China, not only to secure the raw materials it needs but also to export its finished products. The recent US elections will only comfort China into this strategy and most likely accelerate its momentum.