[LINK] China bans exports to US of gallium, germanium, antimony in response to chip sanctions

[Kim Holburn]

https://abcnews.go.com/Business/wireStory/china-bans-exports-gallium-key-high-tech-materials-116399597

BANGKOK -- China announced Tuesday it is banning exports to the United States of gallium, germanium, antimony and other key 
high-tech materials with potential military applications, as a general principle, lashing back at U.S. limits on 
semiconductor-related exports.

The Chinese Commerce Ministry announced the move after the Washington expanded its list of Chinese companies subject to export 
controls on computer chip-making equipment, software and high-bandwidth memory chips. Such chips are needed for advanced applications.

The ratcheting up of trade restrictions comes as President-elect Donald Trump has been threatening to sharply raise tariffs on 
imports from China and other countries, potentially intensifying simmering tensions over trade and technology.

China's Foreign Ministry also issued a vehement reproof.

“China has lodged stern protests with the U.S. for its update of the semiconductor export control measures, sanctions against 
Chinese companies, and malicious suppression of China’s technological progress," Lin Jian, a Chinese Foreign Ministry spokesperson, 
said in a routine briefing Tuesday.

"I want to reiterate that China firmly opposes the U.S. overstretching the concept of national security, abuse of export control 
measures, and illegal unilateral sanctions and long-arm jurisdiction against Chinese companies,” Lin said.

China said in July 2023 it would require exporters to apply for licenses to send to the U.S. the strategically important materials 
such as gallium and germanium. In August, the Chinese Commerce Ministry said it would restrict exports of antimony, which is used in 
a wide range of products from batteries to weapons, and impose tighter controls on exports of graphite.

Such minerals are considered critical for national security. China is a major producer of antimony, which is used in flame 
retardants, batteries, night-vision goggles and nuclear weapon production, according to a 2021 U.S. International Trade Commission 
report.

The limits announced by Beijing on Tuesday also include exports of super-hard materials, such as diamonds and other synthetic 
materials that are not compressible and extremely dense. They are used in many industrial areas such as cutting tools, disc brakes 
and protective coatings. The licensing requirements that China announced in August also covered smelting and separation technology 
and machinery and other items related to such super-hard materials.

China is the biggest global source of gallium and germanium, which are produced in small amounts but are needed to make computer 
chips for mobile phones, cars and other products, as well as solar panels and military technology.

After the U.S. side announced it was adding 140 companies to a so-called “entity list” subject to strict export controls, China’s 
Commerce Ministry protested and said it would act to protect China’s “rights and interests.” Nearly all of the companies affected by 
Washington's latest trade restrictions are based in China, though some are Chinese-owned businesses in Japan, South Korea and Singapore.

Both governments say their respective export controls are needed for national security.

China's government has been frustrated by U.S. curbs on access to advanced processor chips and other technology on security grounds 
but had been cautious in retaliating, possibly to avoid disrupting China’s fledgling developers of chips, artificial intelligence 
and other technology.

Various Chinese industry associations issued statements protesting the U.S. move to limit access to advanced chip-making technology.

The China Association of Automobile Manufacturers said it opposed using national security as a grounds for export controls, “abuse 
of export control measures, and the malicious blockade and suppression of China.”

“Such behavior seriously violates the laws of the market economy and the principle of fair competition, undermines the international 
economic and trade order, disrupts the stability of the global industrial chain, and ultimately harms the interests of all 
countries,” it said in a statement.

The China Semiconductor Industry Association issued a similar statement, adding that such restrictions were disrupting supply chains 
and inflating costs for American companies.

“U.S. chip products are no longer safe and reliable. China’s related industries will have to be cautious in purchasing U.S. chips,” 
it said.

The U.S. gets about half its supply of both gallium and germanium metals directly from China, according to the U.S. Geological 
Survey. China exported about 23 metric tons (25 tons) of gallium in 2022 and produces about 600 metric tons (660 tons) of germanium 
per year.

The U.S. has deposits of such minerals but has not been mining them, though some projects underway are exploring ways to tap those 
resources.

The export restrictions have had a mixed impact on prices for those critical minerals, with the price of antimony more than doubling 
this year to over $25,000 per ton. Prices for gallium, germanium and graphite also have mostly risen.
-- 
Kim Holburn
IT Network & Security Consultant
+61 404072753
mailto:kim at holburn.net  aim://kimholburn
skype://kholburn - PGP Public Key on request