Is the indium licence leaking? Indium after China's Feb-2025 export-licence regime

Eighth material in the circumvention track (R72), companion to the antimony, graphite, tungsten, bismuth, rare-earth-magnet, germanium and tellurium cases. The price wedge measures scarcity (what a controlled material costs ex-China). This case measures the other half: is the control actually holding, or is Chinese-controlled material re-entering the US through a laundered origin? This is a DUAL-SCORE / alternative-track signal — never folded into any Tier-1 exposure score. The divergence between "who China says it stopped selling to" and "who suddenly started selling to the US" IS the signal. Research, not investment advice; origin-relabelling is INFERRED from statistical implausibility plus public production records, never asserted as smuggling on any single shipment.

Verdict — GATE 0 (the tell is basket-obscured; the one plausible surger is genuine recycled indium)

On 4 February 2025 China's MOFCOM/GAC (Announcement No. 10 [2025]) placed indium — with tungsten, tellurium, bismuth and molybdenum — under dual-use export-licence control. China refines ~70% of the world's indium (USGS MCS 2026 narrative; a 52%→58%→70% decade "refining-share creep"), and the licence bit hard: unwrought indium exports fell ~72% YoY (Sep-2024 → Sep-2025, Asian Metal/USGS) — the deepest export-licence-driven volume crash of the whole Dec-2024/Feb-2025 critical-mineral control wave. By the antimony logic that ought to be a prime laundering candidate.

Yet the US origin channel yields no attributable relabel fingerprint — for two compounding reasons. (1) Refined indium has no dedicated HS6 line: it sits inside the pooled basket HS 811292, which US import data shows is dominated by Brazilian niobium — so indium cannot be isolated at free-data granularity. (2) The one surger that is visible in that basket at an indium-consistent unit value — "Other Asia, nes" / Taiwan — is most plausibly genuine recycled Taiwanese indium (LCD-fab ITO-target reclamation), not a laundered Chinese re-label. This is a hybrid of the germanium-metal leg (basket-obscured) and the tellurium case (the US was already ally-diversified). The licence's real bite shows up in price, not in a US import origin.

Layer 1 — the basket wall (why indium can't be isolated)

Unwrought/scrap/powder indium is reported under HS 811292 ("gallium, hafnium, indium, niobium, rhenium, vanadium; unwrought; waste and scrap; powders"). US imports on that line are dominated by weight by Brazilian niobium (CBMM). A single fresh Comtrade pull makes the wall concrete:

Source: UN Comtrade free public preview API (reporter USA 842, flow imports M, period 202506, HS 811292), pulled 2026-07-15. Indium trades ~$380/kg (Rotterdam 2025 avg); its few tens of kg/month are invisible against ~287 t/month of Brazilian niobium at ~$50/kg. No clean indium origin table can be built from free HS6 data — the same attribution wall the [germanium case](2025-germanium-ban-circumvention-transshipment.md) hit on this identical basket. Committed artifact: data/intelligence/indium-circumvention.json.

Layer 2 — read the shared basket, then resolve it toward indium

The germanium case already pulled the annual HS 811292 series and found the textbook shape at the basket level:

Source: UN Comtrade, reporter USA, annual, HS 811292 (as published in the germanium case). China's basket line collapsed −70% and Taiwan quintupled to #2 — the same shape the [tungsten](2025-tungsten-licensing-circumvention-transshipment.md) and germanium cases flagged. But the germanium case could not say whether the Taiwan surge was gallium, germanium or indium — it only noted the surger unit value (~$375–400/kg) was "consistent with gallium or indium, not germanium metal (~$1,500–3,000/kg)."

The indium lens resolves that ambiguity — toward "not a laundered origin":

• Unit value points at indium/gallium, and Taiwan is a genuine indium source.

~$388/kg is squarely Rotterdam-indium territory (2025 avg ~$380/kg). Taiwan runs one of the world's largest LCD/OLED panel-fab clusters, and closed-loop ITO sputter-target reclamation covers ~50–60% of new target supply industry-wide (USGS/industry). Recycled/secondary indium is a real Taiwanese output — not a ~0%-capacity implausible origin. What reads as an ambiguous relabel tell in the germanium frame reads, in the indium frame, as plausibly legitimate secondary indium.

• The China −70% collapse is pooled, not attributable. It could be gallium

(China ~98%), germanium, indium, or a mix. Indium's own crash is real (−72% global unwrought exports, Asian Metal/USGS) but that is a worldwide figure, not a US-origin collapse the free data can pin to indium.

• No common-ownership tell was traced, and none is expected while the visible

surger is a genuine recycled-indium producer with no shell-relocation chain.

Layer 3 — where the licence actually bites: price, and a resilient US base

Like tellurium and bismuth, the control surfaces in the price channel, not as a laundered US import origin — but more mildly than either:

• Rotterdam indium: ~$311/kg (2024) → ~$380/kg (2025), +22% YoY (peak ~$408/kg

June 2025) — a real step, but a fraction of bismuth's ~4× shock and below tellurium's +84%. The reason is structural: Korean (LS Nikko Onsan, ~165 t/yr, the genuine #2 refiner), Japanese (Dowa, JX Nippon) and Canadian (Teck Trail) smelter output plus high-rate ITO recycling could partially substitute, and LCD-display demand softened.

• The US was already diversified — and barely a China-direct importer. The US

has held zero domestic primary indium recovery since 2017; Indium Corp (NY) operates as a downstream fabricator buying foreign refined In from the allied refiner set (Canada/Teck, Korea/LS Nikko, Japan, France/Nyrstar Auby, Belgium/Umicore). As with tellurium, there was little China-direct US line to reroute — so the origin channel stays quiet by construction.

What it means for the buyer

1. A dedicated HS line is a prerequisite for the origin detector. Antimony and graphite gave clean fingerprints partly because they have their own HS headings. Indium does not — it is pooled with niobium (which swamps it) and with gallium/germanium (which it can't be split from). For such materials the flow-origin channel is structurally blind, and a risk model must fall back on the price wedge and global export-volume series (here the −72% crash) rather than US import origins. 2. Unit-value + recycling context can flip a "tell" into "genuine." The same Taiwan surge that looks like a possible relabel for germanium is, for indium, best explained by legitimate ITO-recycling capacity. The lesson is that an implausible-volume read must always be checked against product form and secondary-supply capacity before it counts as a laundering signal — otherwise a genuine recycler gets mislabelled. 3. The bite is a margin/price problem for ITO users, concentrated on Korea. The +22% indium step lands on display-panel and CIGS-PV feedstock economics. The non-Chinese indium spine leans hard on Korea (LS Nikko Onsan refining + the largest non-CN ITO-target cluster) — a genuine, friendly source, but an increasingly single-point one. A Korean outage would move the Western ITO chain more than the Chinese licence has.

Method & honesty rails

• Trade data: UN Comtrade, US imports, HS 811292 (Ga/Hf/In/Nb/Re/V unwrought,

waste/scrap, powders) + HS 811299 (articles). No dedicated indium HS6 line exists; 811292 is niobium-dominated by weight (Brazil/CBMM), so indium cannot be isolated. The June-2025 snapshot and the annual China/Taiwan/Malaysia series (from the germanium case) are both from the free public preview API.

• Production baseline & price: USGS MCS 2026 indium narrative + Asian Metal via

lib/iptm-material-country-production.ts: China ~70% refining (~1,100 t/yr world), Korea ~16%, JP/CA/BE/FR aggregate ~13% (structural decline); Rotterdam +22% YoY; unwrought In exports −72% YoY (Sep-24→Sep-25).

• Alternative-track only: never touches buyerRelativeScore or the base

exposure — it sits beside them, like the China–West price wedge.

• Inference, not accusation: the negative circumvention read is driven by the

data (the tell is basket-obscured; the visible surger is a genuine recycler) and by the absence of a dedicated HS line — not by exoneration of any party. No shipment is asserted legal or illegal beyond the public record.

• What would change the verdict: a national customs source (or US HTS-10 access)

that isolates indium from the 811292 basket and shows a ~0%-capacity origin (no primary In recovery, no ITO-recycling) surging into a China-collapse gap, or a traced ownership chain from a Chinese indium producer to a surging non-refiner exporter-of-record. Neither is present now. Until then indium is the "basket-obscured + already-diversified" case: the licence bites on price, the origin channel is structurally blind, and the one visible surger is best read as genuine recycled Taiwanese indium.