deposits (Schwarz-Schampera and Herzig 2002), recovery efficiencies, costs of capital, etc., to
generate a representative view of costs and production levels for various deposits. We adopt this
approach when examining what a supply curve for indium might currently look like and how this
might change going forward, and we use a Monte Carlo simulation to generate a short-term
supply curve. A detailed description of the methodology used to generate these curves is
included in Appendix D.
Figure 11 shows that producers require a minimum indium price of $100/kg (in 2011 U.S. dollar
[USD] terms) to be incentivized to produce indium. Below this price level, even the highest
grade deposits cannot economically recover indium. At prices of ~$150/kg and ~$300/kg of
refined metal produced, indium supply is highly elastic. These two steps in the supply curve
represent byproduct and coproduct production, respectively.
As a result, changes to indium
than $350/kg, indium supply is highly inelastic in the short term where short run production is
constrained by limitations at production facilities. As a result, an increase in price has virtually
no effect on supply because producers need time to change metallurgical processes or plant
capacities to deliver a supply response.
Figure 11. Indium supply (2011)
When considering overall recovery rates in the short term and the amount of indium that could
potentially be recovered from current mining operations, we consider three scenarios:
1. Status quo. Estimates of refined primary indium from existing mines given recovery
efficiencies throughout the value chain.
We distinguish byproduct from coproduct producers as companies that produce indium but allocate no fixed or “common”
(tonnes of primary indium metal per annum)
Short-term primary indium supply curve
2. Scenario 1. Estimates of refined primary indium if the pipeline were structured such that
all indium-bearing concentrates were sent to indium-capable smelters, but assuming
current recovery rates.
3. Scenario 2. Estimates of refined primary indium given in Scenario 1, but also assuming
that recovery efficiencies reflect the latest technologies. This estimate also ignores any
necessary investment and time delays.
These scenarios are discussed in significant detail in Appendix D. Figure 12 shows that, when
varying efficiency across the pipeline such that all indium-bearing concentrates are shipped to
indium-capable smelters, overall recovery of the refined metal increases from 731 tpa in the base
case to 1,044 tpa, corresponding with overall recovery rates of 20%–28%. Once we vary
recovery efficiencies to correspond with current technologies, indium recovery increases to
2,710–3,348 tpa with a midpoint of 2,976 tpa. This corresponds with overall recovery rates of
Figure 12. Short-term primary indium supply. including pipeline efficiency improvements
The general stepwise shapes of the three supply curves in Figure 12 are consistent with Figure 11
curves show the significant effect that increased indium recovery efficiency (either through
technology or better management) can have on the total availability of primary indium in the
China, South Korea, and Japan have recently focused on recovering indium from manufacturing
wastes and EOL products—a practice known collectively as secondary production. Secondary
production of indium can result from two sources of supply: new scrap, which consists of waste
generated in the manufacturing process; and old scrap, which consists of EOL consumer
products. Significant indium recovery currently occurs from the recycling of new scrap
(manufacturing waste), but the highly dissipative nature of indium in consumer products means
that very little old scrap is currently recycled.
Short-term primary indium supply curves