Metalnewsnet 26 Apr:

Indium prices will rise steadily over the coming weeks as demand remains strong and a stand-off in the Japanese market has come to an end, European market participants said. "It's a very sound market," a European trader told MB. "I'm definitely bullish on indium. I don't expect to see the $1,000 per kg we saw previously, but we could see $900 in the longer term."  Downstream LCD producers in Japan have been seeking to drive down prices to increase their market share, attempting to force their suppliers, including glass panel makers and further downstream ITO (indium tin oxide) target makers, to cut costs in turn, a market source told MB. A price stand-off ensued, keeping the market quiet over the past few weeks and creating a situation that appears to have driven the ITO target makers towards recycled material and to have caused a depletion of secondary stocks.

But the three parts of the supply chain subsequently agreed to pass costs along the chain, restoring demand for primary material. "Demand is excellent, but it had been seen as sluggish because it was coming out of recycled material. The price is on the verge of making another upward move; nothing severe but prices could edge up to $700 over the next couple of months," said the source. Meanwhile, the ITO makers are faced with much lower stocks than they were last year, a second market participant told MB. "They cannot live long on reclaimed material, so they can only play the game for a month or so," the source said. "The big difference is that last year, the ITO makers had high stocks of virgin indium. This year they need to buy 200-250 tonnes of virgin indium, compared with around 100 tonnes last year." "Indium production is below demand. There is definitely a deficit and we don't know when the Chinese will release stocks and at what price; the Chinese are very patient."

Material climbed to $590-650 per kg on April 21, up from $580-650, a week after Indium Corp raised its producer price to $640 from $570.  Sales of top quality material were reported today at $645-655 by one market participant, while the lowest reported sales were slightly under $600. All other business was concluded at $610-640 this week. Participants across a range of minor metals markets are being advised to brace themselves for squeezes on any material coming out of China, as local government-imposed environmental crackdowns continue to cripple antimony supply. While indium is less likely to be as severely affected in the immediate future, around half of Chinese output comes from smaller smelters who are most at risk from environmental regulation, the second market source told MB. "In China, around 50% of indium comes from smaller smelters that don't have the right kind of scrubbing equipment to clean the air and water," said the source. "[The pollution crackdowns] could have the same impact on indium [as antimony], but it would take a lot longer because there are more indium smelters and I can't imagine the government s cracking down on them all at once."  This week, indium also became embroiled in the chaos caused by volcanic ash clouds across Europe. At least two producers have had to delay air freight deliveries, but customers have been "understanding", one refiner said. "Deliveries have been affected by a few days due to the ash," a market participant told MB. "It's nothing earth-shattering, just more work."

Editor: KylinTse