BEIJING/SHANGHAI: China imposed restrictions on exporting two metals that are crucial to parts of the semiconductor, telecommunications and electric-vehicle industries in an escalation of the country’s tit-for-tat trade war on technology with the US and Europe.
Monday’s abrupt announcement of controls from Aug. 1 on exports of some gallium and germanium products has ramped up a trade war with the United States and could potentially cause more disruption to global supply chains.
Analysts saw the move, which the Chinese commerce ministry said was to protect national security, as a response to escalating efforts by Washington to curb China’s technological advances. It came on the eve of U.S. Independence Day and just before U.S. Secretary of Treasury Janet Yellen visits Beijing.
“China has hit the American trade restrictions where it hurts,” said Peter Arkell, chairman of the Global Mining Association of China.
The European Commission expressed concern, while Germany’s Economy Minister Robert Habeck said any broadening of controls to materials like lithium would be “problematic”.
One U.S. semiconductor wafer manufacturer said on Tuesday it was applying for export permits, while a China-based germanium producer said buyer enquiries had come in as prices surged.
The eight gallium and six germanium products cited are also used in other high-tech industries.
Some in the metals industry said they feared China could follow with new restrictions on rare earth exports, after curbing shipments 12 years ago in a dispute with Japan. China is the world’s biggest producer of rare earths, a group of metals used in EVs and military equipment.
China produces most of the world’s gallium and germanium.
In 2022, top importers of China’s gallium products were Japan, Germany and the Netherlands, news website Caixin said, citing customs data. Top importers of germanium products were Japan, France, Germany and the United States, it said.
