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Indium the harbinger on the silver horizon?Juergen Mueller On closer inspection one recognizes that Silver and Indium show many parallels. Like Silver, Indium is an element which has unique physical properties which are used in a number of technological areas. According to the USGS report 2004 for Indium 70% of the yearly production are used for LCDs and flat screens. These applications are due to the light permeability and electrical conductivity of Indiumtinoxid, i.e. Indiumtinoxid is a "transparent conductor" (source: en.wikipedia.org).
Beside the 70% usage of a yearly production for LCDs and flat screens, 12% are used up for electronics and semiconductor components, another 12% for solders and alloys and 6% for research. Furthermore due to the USGS report a major computer / chip manufacturer is currently testing Indium in a heat managing application within computers. This new application alone would increase demand for further 40 tons of Indium per year, ie 12% in respect of the production in 2004 which was 325 tons altogether (after 370 tons in 2003, a reduction of 12%). Now, doesn't all this sound familiar to us? Outstanding physical characteristics, from this deduced applications in high-technological areas, increasing demand due to new applications currently under research, depleting resources? Furthermore the concentration in the earth's crust is in the same magnitude: 0,049 ppm for Indium, 0,07 ppm for Silber (source: www.periodensystem.info - in German). According to USGS data Indium seems to be the first industrially used metal which will be depleted. Also, recycling is difficult because time- and cost-intensive. Very little material is used per consumption unit, which also represents a parallel to Silver. According to USGS data the life time of reserves and resources of Indium can be estimated as follows:
This chart shows that Indium reserves and resources should be depleted around 2011 to 2013. Looking a bit deeper, China was the biggest producer in 2004 with 100 tons (1/3 of worlds overall production). Graph 1 for China alone gives an interesting result:
The conclusion is that the resources of the presently largest producer could be depleted well before 2011. Thus, in the remaining "Indium years" a shrinking production will face a rising demand. The price of Indium represents these fundamentals quite clearly.
Graph
3: Price-Chart of Indium 01/2003 - 03/2005 The price of Indium rose from a low of 60 dollars [kg] in 2002 (source: www.computerpartner.de) to currently around 1100 dollars, i.e. 18-fold. Being a Silver investor I suggest youhave a look at Indium. Maybe this gives a forecast of what is about to come concerning Silver when this market will also be ruled by supply and demand only. It should be noted however that currently intense research is underway to replace Indium in the LCD application. If or when this research will lead to satisfying results 70% of the demand could break away more or less. Actually this is also in favour of Silver because technological applications of silver are much more spreaded over many different fields such as electronics, photography, water treatment, wood preservation, etc. Thus, Silver demand does not depend so much on one single application as it is the case with Indium. Just appreciate seeing Indium advancing further in price, knowing that the same thing will happen to Silver (and Gold). Juergen Mueller 
321gold Inc |
