Graphic: China stimulus, mighty gold puts silver on a streak, but not without risk
Silver prices have bubbled up to their highest in over a decade.
A Southwest China court on Thursday announced a rerun of an auction of minor metal indium that was formerly held by the Fanya Metal Exchange, after the initial attempt at a sale drew no bids – but did not reduce its asking price.
The fate of the 3,609.46 tonnes of indium – equivalent to about five years of global supply of the silvery metal used in flat-panel displays – is being closely watched by minor metals traders and Fanya creditors seeking to recover their money after the bourse collapsed in 2015.
Spot indium prices in China are currently 10% higher than the asking price
The minimum bid in the 24-hour auction, which will start at 10 am Beijing time (0200 GMT) on Jan. 17, has been set at about 2.85 billion yuan ($411.66 million), or 790.40 yuan per kg, according to a notice from the Kunming Intermediate People’s Court on Chinese e-commerce website Taobao.
The court has kept the exact asking price as that of the earlier auction held during Dec. 29-30, when the quantity proved too big to tempt any bidders. Spot indium prices in China are currently 10% higher than the asking price at 875 yuan per kg, according to Asian Metal, having fallen by more than 40% in 2019 as the inevitable Fanya indium sale weighed on the market.
One China-based indium purchaser, however, was sceptical whether the auction result would be any different second-time around, querying why a buyer would want to fork out over $400 million to have so much indium in stock. “If you have such money … put it in the bank and you can double it in 10 years,” he quipped.
Last year, the Kunming court auctioned off most of Fanya’s inventory, including a small quantity of indium, raising a total of about 5.6 billion yuan, according to Reuters calculations, although creditors say they are owed roughly 43 billion yuan. The remaining indium is the last big-ticket item that still needs to be sold.
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