Dongwu Securities: Optimizing Strategic Small Metal Recycling Opportunities Under the AI Outbreak, an Advantageous Resource Leader

The Zhitong Finance App learned that Dongwu Securities released a research report stating that it is a resource leader for selected raw materials channels, purification technology, qualification barriers, and downstream customers. The growth of the AI metal recycling industry is not a simple expansion of production capacity, but rather “being able to receive, be able to sell well, and have strong compliance.” On the raw material side, high-grade materials such as electronic waste, industrial catalysts, and precious metal waste liquid waste residue are required; on the technical side, complex material separation, multi-metal collaborative recycling and high-purity refining capabilities; on the qualification side, hazardous waste management, environmental compliance and safe production form the industry entry threshold; clients, if downstream cover high-end manufacturing fields such as semiconductors and electronic materials, directly enjoy the dividends of demand expansion.

The main views of Dongwu Securities are as follows:

Demand for AI has exploded, reshaping the value of AI metals in three dimensions

The high-power, high-speed, and high-density evolution of AI hardware reshapes the value of AI small metals in the three dimensions of irreplaceable demand, rigid supply, and scarce strategy. 1) Demand is irreplaceable: although indium, bismuth telluride, ruthenium, etc. are used in small units (grams), the core affects the performance of optical interconnection, temperature control, storage media, etc.; demand elasticity is directly driven by computing power hardware; 2) Recycling is an important increase: the supply side is generally limited by primary ore endowments, mostly by-products associated with smelting such as copper, zinc, and molybdenum. The scale of parent metal smelting determines the supply ceiling, and recycling becomes a key incremental; 3) Strategic scarcity: most varieties have been included in export controls or strategic mineral catalogues, and native channels are endowed with resource endowments Policies are double locked down, and marginal supply is more dependent on the expansion of the recycling system.

Bismuth/tellurium: computing power temperature control core, bismuth telluride locks in AI thermal management

Supply: There are no independent deposits of bismuth or tellurium. The supply ceiling is locked in copper, zinc, and molybdenum smelting and electrolytic copper production. China accounts for about 86% and 80% of the world's refining production, respectively. Requirements: Bismuth telluride (BiTE) is the core thermoelectric material for AI servers and optical modules TEC (tellurium CdTe thin film photovoltaics account for about 70%, thermoelectricity accounts for about 15%), and the evolution of optical modules to 1.6T/3.2T is driving demand. Strategic position: From February 2025, China will implement dual-use items control on high-purity bismuth and implement export controls covering the entire industrial chain of tellurium.

Indium: InP substrates determine the value of AI optical communication

Supply: Indium is a pure companion metal. The supply ceiling is zinc smelting scale. The global refining of indium is about 1,100 tons/year (2025), and China accounts for about 70%. Requirements: Pure indium is used to produce indium phosphide (InP) substrates and is the core material for high-speed optical chips. The upgrade of optical modules from 800g to 1.6T/3.2t has led to a doubling of InP demand. Strategic position: Indium itself is not regulated; the three compounds controlled are InP, TMI, and TEI; high-end InP substrates are dominated by Japan's Sumitomo, American AXT, and Japan's JX (about 80-90% in total), and the share of Chinese manufacturers is still low.

Platinum family: invisible materials for storage and passive components

Supply: China's primary ore endowments are weak, with an annual native production of only about 3 tons and an annual regeneration volume of about 31 tons (close to ten times that of native); global reserves are about 76,000 tons, and South Africa accounts for about 83%. Requirements: Ruthenium is used for memory chip targets and advanced process interconnections, palladium is used in MLCC slurries, and demand for AI storage and passive components indirectly drives platinum group usage. Strategic position: Platinum is not on the control list, but China accounts for more than 30% of global consumption, long-term net imports (about 104 tons of platinum and 28 tons of palladium in 2024), and raw materials are controlled by South Africa and Russia.

Antimony: flame retardant and semiconductor-doped double wire pull

Supply: High-quality single ores are being exhausted, and the increase is shifting to gold-antimony symbiosis and recycling; in 2025, the world is about 110,000 tons of antimony ore, China is about 40,000 tons (accounting for 36%), and the three countries of China, Russia, and Thailand together account for about 86%. Demand: In 2024, global antimony consumption is about 166,000 tons (+10.8% year over year), flame retardants account for about 44%, photovoltaic glass accounts for about 30%, and there is a structural increase in the composition of AI server PCB/shell flame retardant and semiconductor high-purity doping. Strategic position: The strategic position is at the forefront of small metals. In 2024, the Ministry of Commerce implemented export license management for antimony and gradually tightened exports to the US. After economic and trade negotiations in November 2025, the relevant arrangements were suspended until November 2026.

Rhenium: Dual Drive Metal for Aerospace and Computing Infrastructure

Supply: No independent deposits, mainly from copper and molybdenum smelting by-products recovery: the world mainly relies on molybdenum concentrate roasting smoke and dust, while China relies more on copper smelting and rhenium; in 2025, global output is about 81 tons (China is about 20 tons, accounting for about 25%, second in the world), with reserves of only about 2,500 tons, and Chile accounts for 52%. Requirements: Aerospace nickel-based superalloys (engine turbine blades) are the main demand for rhenium and there is no alternative; the surge in electricity consumption in AI data centers also requires the addition of rhenium to gas turbine blades, which can also be used for high-temperature heating components in MOCVD equipment. Strategic position: There are no special controls, but supply is highly concentrated in Chile and China.

Risk warning: demand for AI hardware falls short of expectations; fluctuating metal prices; procurement of recycled raw materials falls short of expectations; risk of export control and industrial policy changes; capacity release and technical verification fall short of expectations, etc.