According to the US Geological Survey, China produces about 98% of the world's gallium and 60% of the germanium. The bans and subsequent export regulations have underlined Beijing's influence over the supply chain of critical minerals worldwide. These semiconductor metals, namely gallium and germanium, are utilized extensively in semiconductors, communications equipment, and military applications.
China's recent export restrictions on two rare metals, gallium and germanium, are shaking up the global tech landscape. Announced last July and taking effect in August 2023, these controls are causing a spike in prices, especially in Europe, and sparking concerns over shortages in the production of advanced chips and military-grade optical devices.
According to the Financial Times, Chinese exports of germanium dropped from 13,514 kg in the latter half of 2022 to 12,410 kg in the first half of 2024. Gallium exports have taken an even more dramatic hit, plummeting from 28,000 kg in early 2023 to just 16,000 kg by the end of the year.
The official word from Beijing is that these restrictions are necessary to protect its national interests and security. However, it is widely assumed that they are Beijing's response to the US export limits on the sale of highly advanced semiconductor chips and production equipment to Chinese enterprises like Huawei. The US previously stated that it was establishing these export restrictions in order to limit China's access to semiconductors for military and artificial intelligence purposes. In turn, China has limited exports of graphite and antimony, a material used in armour-piercing munitions.
While gallium is commonly found in everyday items like light bulbs, transistors, medical devices, and thermometers, germanium is used in specialized applications such as infrared optics and plastic manufacturing. Both metals are vital for producing high-tech products, including night vision goggles and fiber-optic cables. With the export restrictions now in full force, shortages and price hikes for these critical items could be on the horizon, potentially impacting everything from military gear to the global tech industry.
