Indium Prices Explained
The steady influx of demand and supply made indium prices hover around $500 per kilogram and are up +26.97% since last year. Will it continue to rest on moderate levels? Check its top price determiners.
Why are indium prices fluctuating?
1. Demand in the Electronics Sector
The electronics sector is the top industry consumer and price mover of indium.
Indium is essential in making Liquid Crystal Displays (LCDs), touch screens, semiconductors, solar cells, and other electrical devices as it provides a clear and conductive coating that allows the transfer of electrical signals while maintaining visibility
Thus, the increasing demand for this metal is due to the expansion of the electronics industry. Additionally, the continuous innovation of advanced technologies such as 5G, IoT, and AI influence indium prices and market growth.
2. Solar Energy Sector Expansion
The sustainability campaign takes part in the increase of indium prices. The solar energy sector’s expansion is another significant factor contributing to the rising demand for indium.
It is a critical component in creating photovoltaic cells used in solar panels to convert sunlight into electricity. Thus, the growing need for renewable energy sources will fuel the growth of solar energy, ultimately affecting indium prices.
3. China’s Dominance in Indium Production
China is the world’s largest refinery producer of indium. Its production averages 500 metric tons and it accounts for more than half of the global output. This dominance in production gives China significant influence over global indium prices.
For instance, the country’s decision to lower its metal output this year tightens the availability of indium in the international market. Thus, any policy changes in China impact indium prices.
4. Environmental Concerns
Indium is a by-product of zinc mining. According to a study by DSpace@MIT, the production of indium contributes to negative environmental impacts such as soil erosion, water pollution, and habitat destruction.
Additionally, irresponsible disposal of indium-containing products poses risks as it is toxic to humans and animals. These concerns will prompt indium producers to limit their production, ultimately creating an imbalance between the demand and supply.
Which variables impact the price of indium?
- Demand in the Electronics Sector
- Solar Energy Sector Expansion
- China’s Dominance in Indium Production
- Environmental Concerns
- Supply Chain Disruptions
Where does indium come from?
Indium is a rare metal element but has more deposits than silver and mercury. Two German chemists, Ferdinand Reich and Hieronymus Theodor Richter discovered this metal in 1863 while examining zinc ore samples as they saw a predominant indigo line, thus the origin of its name.
The production process of indium comes into two main stages:
Extraction from zinc ores. Indium extraction from zinc ores during the roast-leach-electrowinning process of zinc smelting.
In this step, the zinc ore is roasted to convert the zinc sulfide to zinc oxide. The zinc oxide is leached with sulfuric acid to produce a zinc sulfate solution. The indium remains in the solid residue along with other impurities such as iron and lead.
Purification and refining. The metal is purified and refined using a variety of methods:
1. Solvent extraction – Solvent extraction is used to separate the indium from other impurities in the solid residue. The indium is dissolved in an organic solvent and extracted from the solvent using an aqueous solution.
2. Electrowinning – Electrowinning is a process of depositing the indium from the aqueous solution into a cathode. The pure indium is stripped from the cathode and melted into ingots. The following is a more detailed description of the production process of indium:
1. Roasting – The zinc ore is roasted in a furnace. This is done by heating the ore in the presence of air at temperatures of 600-700°C. The roasting process serves two main purposes:
- It removes sulfur from the ore which makes the indium more accessible for leaching.
- It converts the indium into a more soluble form which is easier to recover from the leachate.
2. Celsius – The melting point of indium is 156.6°C, so the temperature when producing indium should be above this temperature. However, the exact temperature will vary depending on the production process used.
3. Leaching – The zinc oxide is leached with sulfuric acid to produce a zinc sulfate
solution. Additionally, this solution contains other impurities such as iron and lead.
4. Solid residue – The leaching process leaves behind a solid residue that contains the indium. The filtration method separates the indium from the zinc sulfate solution.
5. Solvent extraction – Using a solvent extraction process, the indium is removed from the solid residue. This process involves dissolving the indium in an organic solvent and drawing it out from the solvent using an aqueous solution. Next, the pure indium is cleared from the cathode and melted into ingots.
What are the uses of indium?
Here are some of the top applications of indium:
1. ITO Targets – Indium Tin Oxide (ITO) is used to make transparent and conductive electrodes in the plasma TV and LCD TV screen industries. Additionally, part of ITO is essential as the sensitive element for some gas measurements. About 70% of global indium directly goes to ITO targets production.
2. Electronic Semiconductors – Indium’s high boiling point, low resistance, and corrosion resistance properties are important in the electronic semiconductor industry. Manufacturing various products such as electrodes for liquid crystal displays (LCDs), bearings for high-speed motors, and semiconductors for transistors, rectifiers, and diodes count on indium.
3. Solar Cells – The production of solar cells isn’t complete without indium alloys. Copper-indium thin film solar cells have the characteristics of low production cost, low pollution, and good performance under low light.
4. Alloy Production – A small amount of indium added into alloy production can improve its strength, ductility, and wear and tear resistance. Furthermore, due to its low melting point, indium is incorporated to produce a variety of fusible alloys.
5. Gasket or Liner Materials – Because of its excellent plasticity, low vapor pressure, and ability to stick to various materials, the aerospace industry uses it as a gasket or lining material in high-altitude instruments.
Overall, this silvery-white metal largely comes from China, South Korea, Japan, Canada, and Belgium.
What is the future price of indium?
Generally, indium’s profitability mainly relies on the demand for electronics and its supply side ( as it is a by-product of zinc mining).
The growth in the use of LCDs and touch screens, as well as the expanding solar cell industry. Additionally, emerging studies about using indium in developing new types of batteries and other energy storage devices will likely influence its varying prices.
Furthermore, its rising application in the automotive industry (as a component of electric and hybrid cars due to its low cost and high-performance benefits) is another price mover. For instance, each Toyota Prius reportedly contains as much as 1 kilogram of neodymium in its motor.
Moreover, two car manufacturers (BMW and Ford) announced an investment of 20 billion Euros (sourcing raw materials for electric vehicles) and 11.4 billion dollars (factories for electric cars), respectively.
Overall, the underlying factors hint at tailwinds as market analysts predicted an even elevated indium price in 2030 amounting between $1,000 and $1,200 per kilogram. This represents a potential increase of 11% to 33% from the current price.