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What we consider the largest single demand driver of the trend in specialty metals today is simply our endless pursuit of higher-quality, ever-more efficient devices at ever-lower prices. It’s difficult for many people to grasp the extent to which the combination of advances in computer-processing power, analytical and modeling software and data storage—all of which were attended by plunging prices—has enabled an explosion in material science and metallurgical R&D.

Literally, the more these scientists look, the more new and exciting uses they find for these specialty metals. The unique performance characteristics of these metals limit substitution and such trace amounts are used, that the metals are price inelastic. Many of these metals, such as tellurium , which is actually scarcer than platinum, are sourced only as a byproduct of other metal production, which render them supply inelastic. Add in the fact that many experience dissipative uses, but lack recycling protocols, and the enormity of the supply problems begin to come into focus. Add sovereign risk and resource protectionism to the mix, and it becomes equally apparent that these supply problems are entrenched, structural and without quick remedy—regardless of how fervently the free marketeers chant, “Market Forces Will Prevail.”

Keep in mind that rapid technological advance shrinks a device’s operational lifespan (everyone wants the latest, greatest version) and that, to a large degree, the specialty metal demand trajectory is discovery-driven rather than correlated directly with GDP, as is the case with oil, base metals, lumber, etc. An example of this can be seen with the mobile phone market—while the global financial crisis (GFC) crimped demand for high-end phones, unit sales of low-end models actually increased as demand from so-called “emerging markets” continued unabated.