Export Controls for Indium – China's Strategic Move in the Trade War with the USA
With its latest export controls on indium, China is once again flexing its muscles in the trade conflict with the USA. Without its own production, the USA is highly dependent on this critical commodity. Should these controls escalate into an export ban, this would have both technological and strategic consequences for the USA. However, investors now have the opportunity to react to this development and even profit from it.
Why Indium Is So Critical
Indium is a dual-use raw material with applications in civilian and military technology. It is used in touchscreens, flat screens, and solar modules, but also in military sensors and missile guidance systems. The USA is heavily dependent on indium imports, as it has no significant domestic production and presumably no reserves like those for germanium. In 2023, the USA accounted for approximately 300 tonnes of the global production volume of 990 tonnes – while China controls 60% of global production. This dominance makes indium a geopolitical lever that China is now strategically utilizing.
Impacts on the USA and Global Supply Chains
The export controls could severely impact the USA. Unlike with germanium or gallium, there are hardly any alternatives or strategic reserves for indium. Companies such as Lockheed Martin, which rely on indium for communication systems and missile technology, are particularly affected. Supply shortages could also become noticeable globally, driving indium prices even higher – a clear opportunity for investors.
Investment Strategies
Our purchase price for indium rose by 20% overnight. Nevertheless, we were able to secure 200 kilograms for our customers, allowing them to hedge their positions and benefit from these developments. The key to successful investments lies in recognizing future patterns such as “tariffs–export controls–higher tariffs–export bans” at an early stage. Particularly with rare earths such as dysprosium, a potential next target of Chinese export bans, opportunities currently remain available. We can continue to supply these metals without restriction – an attractive option for forward-looking investors.
Conclusion
At present, indium is the order of the day. Nevertheless, investors can now get ahead of the wave with heavy rare earths such as terbium oxide and dysprosium oxide! For if China stops delivering these metals to the USA, prices will rise here as well, and only limited supply quantities will be available!