PETALING JAYA: Malaysia Smelting Corp
Bhd (MSC) is expected to see earnings supported by higher mining output and cost efficiencies, even as constraints in tin ore supply persist.
In a report, UOB Kay Hian (UOBKH) Research said MSC is enhancing upstream efficiency at Rahman Hydraulic Tin, the country’s largest open-pit eluvial tin mine, with its newly completed sand-tailings recovery plant on track to commence operations in April 2026.
The research house said the plant is expected to add approximately three tonnes of tin per day after a three to six-month ramp-up, “lifting effective mining output from about 11 tonnes per day to between 14 and 15 tonnes per day through improved recovery of previously discarded material”.
“This will reduce the reliance on third-party ore for its smelting operation with internal ore intake increasing from 20% to 25%,” it said.
UOBKH Research said global tin supply remains constrained, “due to regulatory and operational challenges in key producing regions,” supporting a firmer price outlook.
The research house added that its London Metal Exchange tin price assumptions stand at US$45,000 per tonne for 2026 and US$46,000 per tonne for 2027.
It said Indonesia’s crackdown on around 1,000 illegal mines, along with stricter licensing and environmental enforcement, has tightened tin ore availability.
At the same time, the Bisie mine in the Democratic Republic of the Congo, which accounts for about 8% of global tin ore supply, continues to face security and logistical risks that may constrain output.
In this environment, the research house noted that MSC’s smelting division continues to face challenges in securing third-party tin ore, as China’s smelting capacity exceeds its domestic mine supply, intensifying global competition for raw materials.
Despite this, it said near-term earnings are expected to be cushioned by the encashment of tin intermediates, which currently stand at 1,964 tonnes, as well as increased intake of internally sourced ore following the expansion of mining output.
