IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v13y2021i14p7881-d594435.html
   My bibliography  Save this article

Agent-Based Modeling for By-Product Metal Supply—A Case Study on Indium

Author

Listed:
  • Jinjian Cao

    (Environmental and Ecological Engineering, Purdue University, 500 Central Dr, West Lafayette, IN 47907, USA)

  • Chul Hun Choi

    (Industrial Engineering, Purdue University, 315 N. Grant Street, West Lafayette, IN 47907, USA)

  • Fu Zhao

    (Environmental and Ecological Engineering, Purdue University, 500 Central Dr, West Lafayette, IN 47907, USA
    Mechanical Engineering, Purdue University, 585 Purdue Mall, West Lafayette, IN 47907, USA)

Abstract

With rapid development and deployment of clean energy technology, demand for certain minor metals has increased significantly. However, many such metals are by-products of various host metals and are economically infeasible to extract independently. Meanwhile, by-product metals present in the mined ores may not be extracted even if they are sent to smelters along with host metal concentrates if it is not economically favorable for the producers. This dependency poses potential supply risks to by-product metals. Indium is a typical by-product metal, mainly from zinc mining and refining, and is important for flat panel displays, high efficiency lighting, and emerging thin-film solar panel production. Current indium supply–demand forecast models tend to overlook the volatile and competitive nature of minor metal market and are mostly based on top-down approaches. Therefore, a bottom-up agent-based model can shed new light on the market dynamics and possible outcome of future indium supply–demand relationship. A multi-layered model would also be helpful for identifying possible bottlenecks of indium supply and finding solutions. This work takes indium as an example of minor metal market and sets up an agent-based model to predict future market situation and supply–demand balance. The market is modeled as a Cournot competition oligopolistic market by refineries with capacity restriction based on host metal production. The model maintains active Nash equilibrium each year to simulate competitions between suppliers. The model is validated and verified by historical data and sensitivity analysis. Several scenarios are also explored to illustrate possible uncertainties of the market.

Suggested Citation

  • Jinjian Cao & Chul Hun Choi & Fu Zhao, 2021. "Agent-Based Modeling for By-Product Metal Supply—A Case Study on Indium," Sustainability, MDPI, vol. 13(14), pages 1-28, July.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:14:p:7881-:d:594435
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/13/14/7881/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/13/14/7881/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Young, David & Poletti, Stephen & Browne, Oliver, 2014. "Can agent-based models forecast spot prices in electricity markets? Evidence from the New Zealand electricity market," Energy Economics, Elsevier, vol. 45(C), pages 419-434.
    2. Zhang, Kaihua & Wu, Yufeng & Wang, Wei & Li, Bin & Zhang, Yinan & Zuo, Tieyong, 2015. "Recycling indium from waste LCDs: A review," Resources, Conservation & Recycling, Elsevier, vol. 104(PA), pages 276-290.
    3. Xinkai Fu & Adriano Polli & Elsa Olivetti, 2019. "High‐Resolution Insight into Materials Criticality: Quantifying Risk for By‐Product Metals from Primary Production," Journal of Industrial Ecology, Yale University, vol. 23(2), pages 452-465, April.
    4. Fthenakis, Vasilis, 2009. "Sustainability of photovoltaics: The case for thin-film solar cells," Renewable and Sustainable Energy Reviews, Elsevier, vol. 13(9), pages 2746-2750, December.
    5. Riddle, Matthew & Macal, Charles M. & Conzelmann, Guenter & Combs, Todd E. & Bauer, Diana & Fields, Fletcher, 2015. "Global critical materials markets: An agent-based modeling approach," Resources Policy, Elsevier, vol. 45(C), pages 307-321.
    6. Choi, Chul Hun & Eun, Joonyup & Cao, Jinjian & Lee, Seokcheon & Zhao, Fu, 2018. "Global strategic level supply planning of materials critical to clean energy technologies – A case study on indium," Energy, Elsevier, vol. 147(C), pages 950-964.
    7. Afflerbach, Patrick & Fridgen, Gilbert & Keller, Robert & Rathgeber, Andreas W. & Strobel, Florian, 2014. "The by-product effect on metal markets – New insights to the price behavior of minor metals," Resources Policy, Elsevier, vol. 42(C), pages 35-44.
    8. Fizaine, Florian, 2013. "Byproduct production of minor metals: Threat or opportunity for the development of clean technologies? The PV sector as an illustration," Resources Policy, Elsevier, vol. 38(3), pages 373-383.
    9. Nassar, Nedal T. & Wilburn, David R. & Goonan, Thomas G., 2016. "Byproduct metal requirements for U.S. wind and solar photovoltaic electricity generation up to the year 2040 under various Clean Power Plan scenarios," Applied Energy, Elsevier, vol. 183(C), pages 1209-1226.
    10. McDonald, N.C. & Pearce, J.M., 2010. "Producer responsibility and recycling solar photovoltaic modules," Energy Policy, Elsevier, vol. 38(11), pages 7041-7047, November.
    11. Redlinger, Michael & Eggert, Roderick, 2016. "Volatility of by-product metal and mineral prices," Resources Policy, Elsevier, vol. 47(C), pages 69-77.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Song, Huiling & Wang, Chang & Lei, Xiaojie & Zhang, Hongwei, 2022. "Dynamic dependence between main-byproduct metals and the role of clean energy market," Energy Economics, Elsevier, vol. 108(C).
    2. Kim, Kihyung, 2020. "Jointly produced metal markets are endogenously unstable," Resources Policy, Elsevier, vol. 66(C).
    3. Liang, Yanan & Kleijn, René & Tukker, Arnold & van der Voet, Ester, 2022. "Material requirements for low-carbon energy technologies: A quantitative review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 161(C).
    4. André Månberger, 2021. "Reduced Use of Fossil Fuels can Reduce Supply of Critical Resources," Biophysical Economics and Resource Quality, Springer, vol. 6(2), pages 1-15, June.
    5. Elshkaki, Ayman & Graedel, T.E., 2015. "Solar cell metals and their hosts: A tale of oversupply and undersupply," Applied Energy, Elsevier, vol. 158(C), pages 167-177.
    6. Frenzel, Max & Tolosana-Delgado, Raimon & Gutzmer, Jens, 2015. "Assessing the supply potential of high-tech metals – A general method," Resources Policy, Elsevier, vol. 46(P2), pages 45-58.
    7. Jordan, Brett, 2018. "Economics literature on joint production of minerals: A survey," Resources Policy, Elsevier, vol. 55(C), pages 20-28.
    8. Shammugam, Shivenes & Rathgeber, Andreas & Schlegl, Thomas, 2019. "Causality between metal prices: Is joint consumption a more important determinant than joint production of main and by-product metals?," Resources Policy, Elsevier, vol. 61(C), pages 49-66.
    9. Choi, Chul Hun & Kim, Sang-Phil & Lee, Seokcheon & Zhao, Fu, 2020. "Game theoretic production decisions of by-product materials critical for clean energy technologies - Indium as a case study," Energy, Elsevier, vol. 203(C).
    10. Jordan, Brett W, 2017. "Companions and competitors: Joint metal-supply relationships in gold, silver, copper, lead and zinc mines," Resource and Energy Economics, Elsevier, vol. 49(C), pages 233-250.
    11. Hu, Xueyue & Wang, Chunying & Elshkaki, Ayman, 2024. "Material-energy Nexus: A systematic literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 192(C).
    12. Fizaine, Florian, 2018. "Toward generalization of futures contracts for raw materials: A probabilistic answer applied to metal markets," Resources Policy, Elsevier, vol. 59(C), pages 379-388.
    13. Song, Huiling & Wang, Chang & Sun, Kun & Geng, Hongjun & Zuo, Lyushui, 2023. "Material efficiency strategies across the industrial chain to secure indium availability for global carbon neutrality," Resources Policy, Elsevier, vol. 85(PB).
    14. Michael Redlinger & Roderick Eggert & Michael Woodhouse, 2014. "Evaluating the Availability of Gallium, Indium, and Tellurium from Recycled Photovoltaic Modules," Working Papers 2014-09, Colorado School of Mines, Division of Economics and Business.
    15. Teixeira, Bernardo & Brito, Miguel Centeno & Mateus, António, 2024. "Raw materials for the Portuguese decarbonization roadmap: The case of solar photovoltaics and wind energy," Resources Policy, Elsevier, vol. 90(C).
    16. Songi Kim & Bongju Jeong, 2016. "Closed-Loop Supply Chain Planning Model for a Photovoltaic System Manufacturer with Internal and External Recycling," Sustainability, MDPI, vol. 8(7), pages 1-17, June.
    17. Redlinger, Michael & Eggert, Roderick, 2016. "Volatility of by-product metal and mineral prices," Resources Policy, Elsevier, vol. 47(C), pages 69-77.
    18. Martin David & Florian Koch, 2019. "“Smart Is Not Smart Enough!” Anticipating Critical Raw Material Use in Smart City Concepts: The Example of Smart Grids," Sustainability, MDPI, vol. 11(16), pages 1-11, August.
    19. Shao, Liuguo & Hu, Wenqin & Yang, Danhui, 2020. "The price relationship between main-byproduct metals from a multiscale nonlinear Granger causality perspective," Resources Policy, Elsevier, vol. 69(C).
    20. Frenzel, Max & Ketris, Marina P. & Seifert, Thomas & Gutzmer, Jens, 2016. "On the current and future availability of gallium," Resources Policy, Elsevier, vol. 47(C), pages 38-50.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:13:y:2021:i:14:p:7881-:d:594435. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.