China’s minerals ban exposes high-tech flaws in US
Washington is vulnerable to Beijing’s supply chain stranglehold when it comes to advanced technology
China has banned the export of the minerals gallium and germanium to the United States amid growing trade tension between the two countries.
The minerals are of critical economic value because they are used in computer chips, in military technology such as night vision goggles, and in the renewable energy industry. They are crucial for manufacturing electric vehicles and solar cells.
All of these areas are very sensitive sectors for the US and the European Union.
China has overwhelming market power over supply because it is the source of 98% of raw gallium and 91% of germanium. In several sectors where the minerals are used, there are no substitutes for them.
Gallium and germanium are low-concentration byproducts of major minerals – they’re known as trace minerals. Germanium’s primary source is the residue from zinc refineries and coal fly ash – a powdered residue produced when coal is burnt in power plants.
Third crackdown
Gallium is another byproduct of bauxite ore, the main source of aluminium.
Beijing’s ban closely followed Washington’s third crackdown in three years on China’s semiconductor industry. The US wants to curb exports of advanced chips to China that could be used in applications that threaten America’s national security.
Advanced chips, for example, can be used in electronic warfare linked to artificial intelligence or AI in advanced weapons systems such as hypersonic missiles. China said its ban on gallium and germanium was because of the minerals’ “dual military and civilian uses.”
In 2023, a Reuters news agency report revealed that the US Department of Defense holds a strategic stockpile of germanium, but no reserves of gallium.
In October, the US Geological Survey (USGS) estimated that a total ban on the export of gallium and germanium could result in a US$3.4 billion loss to US GDP as the minerals are vital for everyday products.
They are vital for making the electronic devices we depend on every day, such as smartphones, displays and laptops. So what can Washington do to circumvent the effects of the ban, given China’s near monopoly on the primary production of these critical minerals?
One route is to expand domestic mining of these minerals and this is being explored.
Friendly countries
As previously mentioned, gallium is mainly recovered as a byproduct of processing aluminium or zinc ores. The USGS confirmed that some US zinc deposits contain up to 50 parts per million of gallium, but the mineral is not being processed.
Historically, production of germanium has been limited to one site, the Apex mine in Utah’s Washington County. The Apex mine produced both gallium and germanium as primary products during the mid-1980s, but it has since closed.
Another option is to diversify the primary production of these minerals by investing in zinc, coal, and bauxite refineries in friendly countries. Canada’s Teck Resources is the biggest germanium supplier in North America, extracting the mineral in British Columbia.
An alternative would be to step up extraction from so-called secondary sources.
This means recycling old electronic devices and other hardware. There are no official statistics on secondary supply, but reports estimate that no more than 10% of the total gallium supply comes from secondary sources. This share reaches 30% in the case of germanium.
Yet there are important barriers to increasing the secondary production of these minerals.
The process for recovery through recycling is very complex since, in hardware such as computer chips, the minerals are usually combined with other materials. This makes isolating them difficult.
Reduce costs
Consequently, the Chinese ban represents a major supply chain disruption for these minerals. The lower primary costs cannot be offset by secondary supply or recycling in the short term since the recovery yield is uncompetitive.
In the long term, technological advances in this process for both minerals could reduce costs and increase the supply, thus reducing the dependence on Chinese mineral ores.
Jorge Valverde is a PhD Fellow of UNU-MERIT at the United Nations University.
This article is republished from The Conversation under a Creative Commons license. Read the original article.
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy of China Factor.