Updates to this story
The market for indium is expected to see an annual average increase of 16 percent up until 2013, following a good 2010.
The growth will be supported by the continued demand for LCD screens, while applications for Photovoltaic solar cells are expected to contribute on a smaller scale.
Indium, a key raw material in indium tin oxide (ITO), is widely used in liquid crystal diplays and touchscreen technologies.
With the increasing proliferation of devices using the material it is expected that growth will continue, with demand particularly strong in the television and computer monitor markets.
Like many markets the indium industry is seeing demand recover from a downturn in 2009, and is now seeing focus switch to the supply side, according to Roskill Information Services. Production capacity is currently significantly above current output, so it will be possible to increase production at existing facilities.
China, where roughly half the global output is centred, may have more capacity than previously thought - with scope to increase production.
It is not thought that the use of ITO in the production of PV panels is expected to contribute hugely to the expected indium demand growth, due to supposed doubts over growth rates for the solar panels.
Of course it is noted that the PV market is a newer and faster growing market, with solar applications for indium increasing by 40 percent per year, though from a smaller base rate.
Following many fluctuations in the past years, indium prices surged upward in early 2010, buoyed by purchases from Japanese producers of LCDs who appeared to have completed a long period of de-stocking and were beginning to rebuild inventories.
With indium demand expected to increase strongly over the next two years it is thought that the main problem will be for production capacity to continue to keep up with demand.
If this is the case it is expected that indium prices could reach around $850/kg by 2013, though it is thought that in the longer term, as supply begins to meet demand, prices are likely to stabilise.
There is some controversy over the amount of indium availability in the world. According to Indium Corporation the figure stands at 26,000 megatonnes in the “western world”, while China and Russia account for 23,000 megatonnes of the world’s reserves.
To illustrate how widespread it claims indium is, Indium Corporation reckons the raw material is more prevalent in the earth than silver.
TechEye recently reported on how carbon nanotubes are being looked as a potential alternative to indium.