25 November 2025

Gallium supply squeeze: why high prices cannot quickly create new supply

Key insights from this briefing

How could Australia's Wagerup refinery diversify gallium supply?

The proposed Wagerup project would recover gallium from an existing alumina-refining stream rather than rely on a stand-alone gallium mine. The project was targeting about 100 tonnes per year, roughly 10% of global supply, showing how existing alumina infrastructure can support new non-Chinese gallium production.

Why can gallium prices rise faster than supply can respond?

Gallium is produced mainly as a by-product of aluminium refining, so output depends on the operating rate and recovery technology of the host industry. When semiconductor or defence demand jumps, high gallium prices alone cannot quickly create new supply, which can amplify spot-market volatility.

Excerpt from this briefing's Industry Insight

Gallium's sharp price moves reflect an unusually inelastic supply chain. The metal is recovered mainly as a by-product of bauxite refining, so production cannot simply be switched on when semiconductor demand accelerates. GaN and GaAs compounds are critical to radar, communications and power electronics, encouraging buyers to prioritise physical availability over price when inventories tighten. The briefing also highlighted new Australian recovery capacity as an example of how governments and refiners are trying to convert existing alumina infrastructure into diversified gallium supply.

This is an excerpt from the Industry Insight in the full Market Briefing. Log in to access the complete briefing.