What just happened? China has retaliated against the tightening export controls placed on it by the United States by banning shipments to the US of key materials used in semiconductor manufacturing and military applications. Gallium, germanium, antimony, and super-hard materials are some of the dual-use items China is prohibiting from export. Beijing is also imposing stricter controls on graphite.
China imposed export controls on gallium and germanium in 2023, two metals that are vital parts of the semiconductor, telecommunications, and electric vehicle industries. Exporters need to apply for licenses from the commerce ministry if they want to ship them out of the country. In August 2024, China introduced the same limits on antimony, a metal used in batteries and photovoltaic equipment, as well as military applications such as ammunition, infrared missiles, nuclear weapons and night vision goggles.
The new ban strengthens existing limits on these exports, but they only apply to the US. China is also requiring stricter reviews of end-users and end-uses for exports of graphite, a critical component of electric vehicle batteries.
The newly announced limits also cover super-hard materials, such as diamonds and other synthetic materials that are not compressible and extremely dense, reports AP. These are used in cutting tools, disc brakes and protective coatings.
"To safeguard national security interests and fulfil international obligations such as non-proliferation, China has decided to strengthen export controls on relevant dual-use items to the United States," China's Commerce Ministry said.
China accounts for 94% of the world's production of gallium, and 83% of germanium. Exports of the two materials from China to the US had fallen to zero following the introduction of restrictions last year.
China accounted for 48% of globally mined antimony last year. The country's overall shipments of the material in October dropped by 97% from September following the introduction of the export controls.
China's move comes a day after the Biden administration announced a new set of sanctions designed to restrict China's access to critical Western technologies that could have AI and military applications. At least 140 Chinese organizations were added to the Entity List, joining the likes of Huawei, meaning US companies must apply for and acquire a license, which is rarely granted, if they wish to do business with them.
The US also added 24 additional types of chipmaking equipment to the export-control list, along with three types of software tools used for developing or producing semiconductors.
It was expected that Beijing would respond to the new US sanctions with a ban on the materials.
The concern now is that China could impose export bans on other critical items, including nickel or cobalt. The only US nickel mine will be depleted by 2028.
The China Association of Automobile Manufacturers accused Washington of having "arbitrarily amended the control rules, seriously affecting the stable supply of US chip products".
"The Chinese auto industry's trust and confidence in the procurement of US chip products is being shaken, and US auto chip products are no longer reliable and safe," the association said.
China retaliates against US with bans on critical materials for semiconductors and defense
