Notes From the Field By Simon Black December 14, 2023
Over four thousand years ago in the early 2200s BC, the most dominant superpower in the world was the Akkadian Empire. The Akkadian Empire had conquered all of ancient Mesopotamia and brought the neighboring kingdoms under its control.
And the Emperor at the time, a man named Rimush, wanted to demonstrate to the world just how wealthy and powerful his Akkadian Empire truly was.
So he commissioned a statue to be built— a statue of himself, obviously. And he had it made from the most valuable substance in the world. But Rimush’s monument wasn’t made of gold. Or even silver.
Thousands of years ago, the most valuable resource in the world was actually tin… as in tin foil.
This was a period in history known as the Bronze Age, a point where ancient civilizations had grasped a basic knowledge of metallurgy.
Rather than use stone tools, people discovered that they could smelt copper with tin, and the resulting metal— bronze— was a very sturdy fit for tools, weapons, and building material.
Copper was incredibly abundant, and many copper mines existed in the ancient world. But tin was scarce, especially among proto-European and near-East civilizations.
Miners had to travel a very long way— to the mountains of Afghanistan, or across the British Isles, to find tin. And its scarcity made it extremely valuable.
Tin mines became critical assets. Tin trade routes became strategic resources worth fighting over. In fact it’s possible that the legendary Trojan War may have actually been fought over the tin trade.
So you can understand why it was such a tremendous show of wealth when Emperor Rimush chose to make a statue of himself out of tin.
Human civilization obviously progressed beyond the Bronze Age and eventually learned how to forge iron and steel, so tin became almost forgotten.
Yet surprisingly tin is still quite a critical metal today. In fact its most important use is in solder on electronic circuit boards. Literally every circuit, whether in an iPhone or standard kitchen toaster, contains tin; tin is effectively the glue that binds electron pathways and circuit components together.
But we’re talking very small amounts; every single iPhone, for example, contains just a couple grams of tin— which costs only a few pennies.
Think about that – in order to sell a $1000+ product, Apple requires a few pennies worth of tin. This makes tin extremely important… yet very cheap relative to its importance.
It also means that tin prices could skyrocket 5x, and Apple probably wouldn’t even notice.
Yet for tin producers, a 5x increase in prices would have them ROLLING in profits.
And this is what’s so interesting about tin. It’s not sexy. It’s a mostly forgotten metal. And as a result, there are only a handful of companies in the world that mine it.
Yet with so many more electronics being produced… much of this as a result of the AI revolution… tin supply is actually starting to dwindle.
Back during the Cold War in the 1950s, the US government actually stockpiled tin in an attempt to corner the market and prevent the Soviets from making advanced electronics.
The US didn’t really need all that tin at the time… so for the past several decades, the electronics industry has been slowly drawing down that stockpile.
Tin production also slowed down; after all, why bother with the expense of mining tin when the US government was selling off its stockpiles?
But now the stockpiles are almost gone. And yet tin production is still down… while demand (because of the booming electronics industry) is soaring.
All these conditions create a strong likelihood that tin prices could rise dramatically.
In fact a study conducted by MIT showed that tin was the metal most likely to be impacted by the advent of new generation technologies such as robotics, electric vehicles and AI.
It’s crazy to think about that a forgotten metal that hasn’t been ‘important’ for literally thousands of years since the end of the Bronze Age could stand to benefit the most from the AI boom.
And again, there are only a handful of tin suppliers in the world who mine the stuff. So they could really make a killing.
We recently sent some research to our premium members, for example, about a tin producer that already generates solid profits based on where tin prices are right now. They also pay a great dividend, and could even turn a profit if tin prices were to plummet.
But if tin prices soar, this company (which also has a great balance sheet) could see a dramatic rise in its profitability and value.
I write a lot about the importance of owning real assets, i.e the most important resources that the world truly needs, and the companies that produce them. Food. Energy. Productive technology. And, yes, certain metals like tin that play a prominent role in a coming boom.
Uranium is another great example— I’ve been talking about the importance of nuclear energy and uranium scarcity for quite some time, and saying that eventually the supply/demand imbalance will send uranium prices soaring.
That has now happened. Uranium prices are up more than 50% this year, and at their highest levels since 2008.
I think the same thing could happen to boring old tin, as it once again becomes an incredibly important resource.
Simon Black, Founder Sovereign Man
