Source: Bloomberg

Author: Archie Hunter

China implements export controls on two little -known but crucial metals, and has upgraded the trade war with the United States and Europe in the science and technology field.

But what exactly is 镓 and 竟, how important are they?Below will take readers to quickly understand the relevant points.

What happened?

Beijing announced that it will restrict the implementation of these two metals and their compounds from August 1 to safeguard national security and interests.If an exporter wants to start or continue, he needs to apply for a permission from the Ministry of Commerce.Enterprises need to provide end users and end use proofs when applying, and explain the situation of importers and end users.

What is 锗？？?

Both metals are silver -white and are usually classified as rare metals. They rarely exist in nature, and are usually by -products in the smelting process of mainstream raw materials such as zinc and alumina.

Compared with other commodities such as copper or petroleum, their market size is small -for example, government data show that the value of metal rigids and gallium gallium arsenidium -gallium arsenidized in the United States in 2022 is only about 225 million US dollars.But their use in the strategic industry means that these restrictions may still have a profound impact.

What are their uses?

These two metals have various professional purposes in chip manufacturing, communication equipment and national defense fields.体 For composite semiconductor, TV and mobile phone screens, solar panels and radar, etc.; composite semiconductors combine a variety of elements to improve transmission speed and efficiency.The use of 通 includes optical fiber communication, night vision mirrors and space exploration -most satellites use solar batteries based on 锗.

How important is China?

The trade flow of these small and niche markets is difficult to track, but according to a key raw material research of the European Union this year, China is in an absolute "monopoly" position in these two metals -的 Supply, 83%、 supply.

CRU GROUP of the metal industry information provider said that although these two metals are replaceable, the cost may be higher and may damage performance with alternatives.

Can other countries increase production?

Both metals are not particularly rare, but processing costs may be high.Because China has been exported at relatively low prices for a long time, there are very few refining facilities in other regions.As China increases production, countries including Germany and Kazakhstan have reduced production.

But if China's actions lead to soaring prices, analysts expect other supply countries to increase output to meet demand.

Recycling may also be critical.Factory waste has contributed part of the supply. According to the US Geological Survey, scraps will also be recovered from the windows of retired tanks and other military vehicles.

What else can they produce these metals?

Other countries with capable capacity include Russia and Ukraine (the production of alumina by -products), as well as South Korea and Japan (as zinc by -products).In North America, TECK Resources LTD., located in the Trail smelting factory in British Columbia, it is produced as a by -product of metal smelting as zinc and lead.

Other manufacturers include special material manufacturers 5N Plus Inc. and INDIUM Corporation in the United States.UMICORE SA in Belgium in Europe will produce these two metals.

And the two metals content of some ore may bring the opportunity to increase supply, such as the Kipushi zinc project launched in the Congo next year.