SHANGHAI, China Chinese private investors have helped the minor metals market at a time when most overseas buyers have stayed on the sidelines, delegates told AMM sister publication Metal Bulletin at a recent industry conference.
"When I made purchasing decisions in the past, all I needed to do was some calculation based on my projections of demand and supply," one delegate said in Changsha, China. "There were so few players in the game that it was relatively simple. Now the unpredictable investors make decision-making more difficult, and I think people need to adjust to the new reality quickly."
Attracted by low prices during a period of sluggish demand, many private investors outside of the minor metals industry have entered the market.
"Private capital needs to find an outlet," a second delegate said. "The housing and stock markets stand no chance, given their dismal performances, whereas minor metals could offer a promising long-term return." Exchange-traded minor metals contacts have provided a good channel for the funds to reach the market.
"Indium sales have seen a downturn since the adoption of export tariffs, but exchanges like Yunnan, Fanya and the Wuxi stainless steel market offered a good way to connect private investors with producers," an indium trader from China said.
50 tonnes of indium were delivered to the Wuxi exchange under the August contract, a historic high.
"The 200 tonnes of indium bought since this March (have) seen prices rise above 3,700 yuan, and tellurium may also be given a similar boost," the indium trader added.
"One private buyer intended to buy several tens of tonnes this week, but I told him to wait. Those who only buy a few tonnes of indium or tellurium are only small-time in comparison," he said.
The Metal Bulletin Chinese tellurium price rose to 820 to 850 yuan ($130 to $134) per kilogram Friday, compared with 800 to 830 yuan last Wednesday.