Without these metals, we have no F-35 and many other major weapons systems.
China has announced new export controls on two rare earth metals, gallium and germanium, effective from August 1st. The Ministry of Commerce cited the need to safeguard national security and interests as the motive behind the move.
Under the new regulations, the export of gallium-related items and germanium-related items will require obtaining a license. Export operators must adhere to the prescribed procedures, including submitting an application to the Ministry of Commerce through the provincial commerce department and providing relevant documents.
From August 1, the export of goods related to gallium and germanium will require approval from the Chinese Ministry of Commerce. The new measures are based on a law that came into force in December 2020 that prohibits the export of the latest technologies and products from the country that can be used for military needs. The new restrictions could affect semiconductor manufacturers, including those based in Japan, as China holds a large share of the two rare metals available on the global market. Spriter Team
The ministry emphasized that these metals have a significant impact on national security, justifying the implementation of stricter export controls. However, the concern arises from the fact that China currently dominates the processing and refining of rare earth metals globally. These metals play a vital role in the production of electric vehicles, wind turbines, solar panels, and advanced defense weaponry.
China has slapped export controls on two rare earth metals key to making computer chips. @dannihewson tells TRT World's Adnan Nawaz what that will mean for your wallet. pic.twitter.com/lmvv3Dun2o
— Money Talks (@TRTMoneyTalks) July 4, 2023
Gallium finds extensive use in semiconductors, transistors, and small electronic devices. It is also a crucial component in LED production. Furthermore, military-grade Gallium Nitride is employed in cutting-edge weapon technologies developed by US defense companies.
Germanium, on the other hand, is widely utilized in rectifiers, transistors, and weapons-sighting systems.
Of particular concern is the impact of these export controls on the US defense industry, given the reliance on rare earth metals for manufacturing high-tech weaponry. China’s recent inclusion of Lockheed Martin and a unit of Raytheon Technologies on an “unreliable entities list” due to weapon sales to Taiwan has further escalated tensions.
China produces over 2/3 of ALL rare earth metals. The war had just begun. All the hardware prices will jump high. pic.twitter.com/IDsmjo31CC
— sumon kais (@sumonkais) July 4, 2023
This move by China to restrict the export of rare earth metals essential for producing advanced chips poses a significant wake-up call for the military-industrial complex. It necessitates a swift adjustment of supply chains or increased domestic investment to bolster mining and refining capabilities.
The Chinese Ministry of Commerce’s decision is likely a response to the Biden administration’s recent crackdown on chip-related issues. The US government has been taking measures to address supply chain vulnerabilities and ensure a secure and reliable domestic semiconductor industry.
As the world’s reliance on rare earth metals continues to grow, concerns over China’s dominant position in the market and its potential use as a geopolitical tool have escalated. The implementation of export controls on gallium and germanium underscores the need for countries to diversify their sources of these critical materials and develop domestic capabilities to ensure long-term resilience in key industries.
The situation calls for careful monitoring and strategic planning by governments and industries to mitigate any potential disruptions to the supply chain and minimize the impact on various sectors heavily reliant on rare earth metals.
Major Points:
- China announces export controls on rare earth metals gallium and germanium, effective from August 1, citing national security concerns.
- The Ministry of Commerce states that export of gallium and germanium items will require a license due to their significant impact on national security.
- China currently dominates global processing and refining of rare earth metals, which are crucial for electric vehicles, wind turbines, solar panels, and advanced defense weapons.
- Gallium is used in semiconductors, transistors, and small electronic devices, while germanium finds applications in rectifiers, transistors, and weapons-sighting systems.
- The export controls have raised concerns over potential disruptions in the supply chain, particularly in the US defense industry, and highlight the need to diversify sources of rare earth metals and strengthen domestic capabilities.
Comments – Threads – Links
- More than 80% of the rare earths in the United States and more than 95% in the European Union are imported from China. Although rare earth mining is important, processing and refining are still weak links for Western countries. – Jennifer Garcia
- China announces export controls on two rare earth metals, gallium and germanium, starting Aug 1. Gallium is most common in semiconductors, transistors, small electronic devices & LEDs. Gallium Nitride is found in cutting-edge weapon technology that US defense companies produce. 247AG
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