China halts key mineral exports to the U.S., escalates trade tensions over semiconductors
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China has imposed a ban on the export of critical minerals, including gallium, germanium, and antimony, to the United States, citing national security concerns.
The decision, announced by the Commerce Ministry on Tuesday, follows Washington's intensified restrictions on China's semiconductor industry.
Gallium and germanium are vital components in semiconductors and other high-tech applications, such as infrared technology, fiber optic cables, and solar cells. Antimony, used in ammunition, night-vision goggles, and batteries, is also crucial for military and industrial uses.
The ministry stated that the export of these materials to the U.S. "shall not be permitted in principle" and introduced stricter end-use reviews for graphite shipments. The ban targets items with dual-use potential, serving both civilian and military purposes.
China dominates the global production of these minerals, accounting for 59.2% of refined germanium output, 98.8% of refined gallium, and 48% of mined antimony in 2023. The restrictions are expected to exacerbate supply chain challenges, particularly in the West, where access to these resources is already strained.
Prices for antimony trioxide, a derivative used in flame retardants and electronics, surged by 228% this year, reflecting growing scarcity. Industry analysts predict a scramble to discover alternative deposits, as nations seek to reduce dependence on Chinese supplies.
China's move follows the U.S.'s latest restrictions on semiconductor technology exports, impacting 140 Chinese entities, including Naura Technology Group. This marks the third major U.S. crackdown on China's chip industry in three years, intensifying the ongoing trade war.
Peter Arkell, chairman of the Global Mining Association of China, characterized the escalating restrictions on both sides as a "trade war with no winners."
In a parallel development, Chinese industry groups have urged members to prioritize domestically produced semiconductors, citing concerns over the reliability and security of U.S. chips.
The export ban also revives memories of former U.S. President Donald Trump's trade policies, including tariffs on Chinese goods, which strained relations between the two economic superpowers. Current developments indicate a continuation of these tensions, with strategic materials becoming the latest battleground.