China has imposed a full ban on exports of gallium, germanium, and antimony to the United States, escalating the trade war. This move is seen as retaliation against US restrictions on advanced semiconductor chip exports to China.
It’s clear that critical minerals will be China’s weapon of choice in its escalating trade war with the United States. Every time Washington imposes new restrictions on exports of advanced semiconductor chips to China, Beijing responds by tightening controls on exports of the critical inputs for chip manufacturers. A third clamp-down on China’s semiconductor industry has drawn a swift response in the form of a full ban on exports of Chinese gallium and germanium to the United States.
Exports of antimony, used in photovoltaic glass, are now also banned in what looks like a riposte to U.S. tariffs on Chinese solar panels. This is a carefully calibrated escalation, China using its dominance of critical metals to land like-for-like retaliatory blows for U.S. attacks on its high-technology capabilities. However, the rules of engagement are set to change with the incoming Donald Trump administration threatening blanket tariffs on all Chinese goods.MARKET DISRUPTION The United States was 100% reliant on imports of gallium last year with China accounting for 21% of metal imports, according to the United States Geological Survey (USGS). U.S. import dependency was 82% for antimony and over 50% for germanium, with Chinese products accounting for 63% and 26% respectively of total imports. Flows of Chinese gallium and germanium to the U.S. have dried up this year after Beijing tightened export controls in August 2023. This month’s ban is just official confirmation that China’s Ministry of Commerce (MOFCOM) had already stopped approving exports to the U.S. The supply chains of all three metals have been massively disrupted with buyers scrambling to find non-Chinese supply. The price of antimony has rocketed from $13,000 per metric ton at the start of the year to $38,000 after China announced new export restrictions. The germanium price has jumped from $1,650 to $2,862 over the same perio
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