Chinese gallium suppliers claim to see many inquiries

BEIJING (Asian Metal) 20 Sep 06 - Five Chinese ministries (Ministry of Finance People's Republic of China, Ministry of Commerce of People's Republic of China, National Development and Reform Commission, China Customs and State Administration of Taxation) made joint announcement to remove the 13% of gallium export rebate on September 14th, effective from the next day.

The publicity of the policy stirs the long quiet market, as gallium smelters reported that they received many inquiries, believing that the export price may go up somewhat. However, the price may not rise greatly, as smelters will increase monthly outputs, which will in turn crack down price rise.Asian Metal Copyright However, the price may not rise greatly, as smelters will increase monthly outputs, which will in turn crack down price rise.Asian Metal Copyright

"We've received many inquiries from both domestic and foreign clients, after the abolition of export rebate," said an official from a smelter, which produces smaller than 20tpy of production capacity.

Increased inquiries for gallium metal allows the source to believe that the export price will go up further from USD300/kg before the removal of export rebate. "We offer gallium 99.99%min at around USD340/kg currently, and buyers may not accept the increased price now, but may have no difficulties accepting USD320/kg," predicted the source.Asian Metal CopyrightHowever, the source is not sure whether the price will eventually go up and how far the price can climb.Asian Metal Copyright

However, an official from another smelter takes cautiously positive views towards the market in the coming weeks, despite that they also receive many inquiries.

"We received many inquiries, but have difficulties meeting all requirements of customers," said the source, adding that they can only meet demand from two thirds of domestic customers and refused to contract 4 tons of orders with foreign clients.

However, the source is not sure whether the price will eventually go up and how far the price can climb. "Suppliers will certainly increase offers, but we are not sure how much consumers will accept," said the source.Asian Metal Copyright"We've received many inquiries from both domestic and foreign clients, after the abolition of export rebate," said an official from a smelter, which produces smaller than 20tpy of production capacity.Asian Metal Copyright

If the price goes up for a while, it may slide then, as currently smelters produce less than their full capacities. When smelters operate at full capacities, the market will begin to slide, because demand cannot digest the increased outputs.