With gallium demand soaring and metal producers holding firm in China, gallium prices have skyrocketed and are now up more than 50% year on year.  Prices now sit at over US$500/kg.

 

 

Chinese domestic prices for gallium 99.99% metal are 17% up month-on-month and 51% up year-on-year according to Asian Metal.  Prices FOB China are now as high as US$560/kg. 

Prices have been rising over recent weeks, aided by some COVID-related logistics issues in Shanxi Province.  As of today, demand is strong and supply is very tight, with some producers including Zunyi Aluminium also reporting cutbacks in output owing to feedstock shortages.  However, the uptick in prices is mainly driven by an unwillingness to sell, with producers and traders expecting prices to increase further.  This has led to increased interest and activity in overseas markets. 

While question marks remain over whether Beijing’s Chinese infrastructure splurge will see construction activity reach traditional levels in 2022, it is likely that spending in high-tech areas will be forthcoming, which is positive news for gallium demand. 

Gallium is used primarily in electronic circuits, semiconductors, and light-emitting diodes (LEDs). It is also useful in high-temperature thermometers, barometers, pharmaceuticals, and nuclear medicine tests.  Key forms consumed are gallium arsenide, used to manufacture compound semiconductor wafers used in integrated circuits and optoelectronic devices, which include laser diodes, LEDs, photodetectors, and solar cells; and gallium nitride used to manufacture optoelectronic devices.