China’s Exports of Gallium and Germanium Products Continue to Decline Under Export Curbs
China’s restrictions on exports of gallium and germanium products have disrupted international shipments of these essential chipmaking metals for the second consecutive month, according to customs data released for September. These ongoing restrictions are causing ripples in the global technology supply chain.
In September, China’s exports of wrought germanium products amounted to a mere 1 kilogram, a stark drop from the 8.63 metric tons exported in July, when a surge in buying preceded the imposition of export restrictions. August saw exports plummet to zero, marking a drastic change in the global availability of this critical material.
Under the customs code for “germanium oxides and zirconium dioxide,” September’s data showed exports of 1,420 tons, compared to 1,034 tons in August. However, it’s crucial to note that the data does not specify whether these shipments comprised only zirconium dioxide or if germanium oxide was also included in the export mix.
Contrastingly, China exported no wrought gallium products in both August and September. This is a significant decline compared to the 5.57 tons exported in September 2022.
The root of these export restrictions can be traced back to July when China unveiled limitations on the exports of eight gallium and six germanium products, effective from August 1. These restrictions are part of an escalating trade dispute between Beijing and Washington over access to materials used in manufacturing high-tech microchips.
Exporters of germanium and gallium products now need to secure an export license for dual-use items and technologies, which includes materials with both military and civilian applications. The Ministry of Commerce in China confirmed in September that some Chinese companies have obtained export licenses for gallium and germanium products.
In terms of market dynamics, the spot price of germanium ingot remained stable at 9,700 yuan per kilogram on September 28, based on data from the consultancy Shanghai Metals Market (SMM). In contrast, the price of gallium metal increased by 15% month-on-month, reaching 1,905 yuan per kilogram on September 28. This increase was attributed to temporary supply constraints resulting from improved demand and delays in the commissioning of new production capacity.
For the first nine months of 2023, China’s exports of wrought germanium products totaled 36.49 tons, representing a significant increase of 47.4% compared to the previous year. However, shipments of wrought gallium fell by 61.9% year-on-year, amounting to only 22.72 tons over the same period. These statistics underscore the substantial impact of China’s export restrictions on the global supply of these critical materials.
The disruption in the supply chain for gallium and germanium products has far-reaching implications for industries reliant on these materials, particularly in the production of semiconductors, solar cells, and other advanced technologies. The ongoing trade tensions between China and the United States are contributing to uncertainties in global markets, highlighting the intricate interdependencies within the technology sector.
As the situation continues to evolve, stakeholders across the technology industry will be closely monitoring developments in China’s export policies and their impact on the availability and pricing of gallium and germanium products. These metals remain essential components for the production of high-tech devices, making them central players in the ongoing global technology supply chain saga.
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