In recent times, rare and small metals in commodities have become a hot topic in the capital market.
The prices of strategic resources such as germanium, antimony and tungsten have risen after export policy adjustments, and ordinary investors have begun to pay attention to these metals.
Nowadays, many overseas financial media say that domestic export control policies for all categories of indium may be tightened. After the news leaked out, there has been heated discussion in the industry, and investors are speculating on the concept of indium next Monday.
Many people don’t know what indium is. Let’s completely break down the indium industry chain.
Indium often appears in the transparent conductive films of mobile phones and computer screens. Its raw material is indium tin oxide, which is the ITO target.
Many countries around the world have classified indium as a critical mineral. The United States Geological Survey has listed it as 35 strategically necessary minerals, and the European Union has labeled it a scarce and high-risk resource. At the current consumption rate, there will be an extreme shortage of mineable indium resources within a century.
There are no separate indium mines in nature. Indium is a sparse metal that is mixed in zinc ore and tin ore. It is extracted as a by-product of zinc ore. The cost of mining and purification is high, the recovery rate is low, and it is difficult to increase production in large quantities.
China accounts for more than 70% of the world’s indium reserves and nearly 60% of its output. Peru, Russia, and Canada have low output. Most of Japan, South Korea, and European and American countries rely on Chinese imports.
Indium consumption channels are divided into four major sectors: the traditional consumption field accounts for nearly 80%, and is used to make ITO targets; the AI computing power supporting industry is the core increase, and indium phosphide made of high-purity indium is the core raw material for high-speed optical modules; the demand in the new energy photovoltaic industry is increasing year by year; although the remaining niche fields account for a small proportion, they are indispensable.
Looking back on past policies, this foreign media news is not groundless.
my country will impose export controls on gallium and germanium in 2023. After the implementation of the policy, overseas supply has become tight, prices have risen, and the related sectors of the capital market have started to move.
In 2024, antimony and its products will be added to the control list. In 2025, the export of indium chemical products such as indium phosphide will require approval, but raw indium, etc. can still be exported freely.
Nowadays, it is reported overseas that European and American companies purchase domestic primary indium at low prices and then sell it at high prices after processing. The current situation of resource loss needs to be solved urgently.
Overseas media analysis shows that the policy is likely to include primary indium and indium ingots in the export license control list, and international indium prices may rise. This is also the logic behind the concept of capital deployment indium.
The core starting points of the country’s export control policies include ensuring the supply of raw materials for domestic high-end industries, preventing the outflow of cheap resources and forcing the upgrading of the industrial chain, and considering national security.
From the perspective of the control sequence, refined chemicals are restricted first, and then extended to raw raw materials. This revelation is in line with the pace of policy advancement.
Even putting aside the export control news, indium itself has a basis for price increases.
On the supply side, indium production depends on the scale of zinc mining. In recent years, zinc mining has been restricted, primary indium production has declined, and the amount of recycled indium is limited, making it difficult to fill the gap. In addition, the National Reserve Bureau purchases indium ingots, and the market spot volume has decreased.
On the demand side, traditional consumption is stable, and ITO target material consumption is stable; the AI industry has brought huge increases, and the demand for indium in the optical communications industry has increased significantly; the photovoltaic industry has great potential, and the demand for new photovoltaic panels will make the demand for indium grow by leaps and bounds.
Based on comprehensive supply and demand, the industry is already tightly balanced, and with the implementation of export policies, international indium prices are likely to rise.
As for the capital market conditions, investors speculated whether indium-related sectors would surge on Monday.
Factors stimulating the rise of the sector include: policy expectations bring emotional catalysis, overseas markets have reacted in advance, and A-shares may repeat historical trends; commodity spot prices rise, corporate performance improves; market funds prefer strategic resource themes; industrial chains are concentrated, and there are few related listed companies, which can easily drive the sector.
However, there are also negative risks: foreign media news is just rumors and there is no official announcement. If the policy is not implemented, the sector may rise and fall; domestic spot prices increase after export control, and if demand does not break out simultaneously, domestic prices may be under pressure; short-term speculation is high, and retail investors are easy to buy at high prices; recycled indium can alleviate supply constraints and weaken the price increase dividends.
Taken together, sentiment on the sector may rise on Monday, but it is mostly a short-term trend that requires support from official documents and an outbreak of industry demand to maintain.
From a mid- to long-term perspective, the indium industry chain will be divided into three stages in the future: the resource management and control integration stage, improving management and control methods, integrating mining resources, and increasing reserves; the industrial upgrading stage, supporting local deep-processing companies, realizing domestic substitution, and transforming into a high-end new material manufacturing country; the new energy and computing power industries have driven the industry to explode, indium demand has increased significantly, prices have fluctuated upwards, and related companies have enjoyed dividends.
For ordinary investors, the stock market is highly volatile and relying on rumors to speculate is risky.
The news of the tightening of exports is uncertain, so do not make rash transactions; commodity prices are affected by many factors, and prices may fall back; short-term speculation fluctuates quickly, and retail investors are easily trapped, so control investment funds; when laying out the industrial chain, attention should be paid to companies with deep processing and core technologies.
In short, this news will stimulate the sector in the short term and accelerate industrial upgrading in the medium and long term. Investors should stay rational.
You may wish to communicate in the comment area. If export rumors ferment next week, will indium-related sectors rise? What is the probability that primary indium will be included in the export control list?
