China is reportedly tightening its grip on exports of critical minerals needed for chipmaking, potentially triggering a global shortage of semiconductors, experts warned.
In a series of steps made in recent weeks, the Chinese government has made it considerably harder for foreign companies, particularly semiconductor manufacturers, to purchase the many rare earth metals and other minerals mined and refined mainly in China, the New York Times reported.
China produces almost all of the world’s supply of these materials. The new restrictions solidify that market dominance.
As of October 1, exporters must provide authorities with detailed, step-by-step tracings of how shipments of rare earth metals are used in Western supply chains, a move seen as its bid to command greater authority over which overseas companies receive scarce supplies.
China is also taking greater corporate ownership over the mining and production of metals.
In a deal that has received almost no attention outside the country, the last two foreign-owned rare earth refineries in China are being acquired by one of the three state-owned companies that run the other refineries in China, the NYT report said.
Beijing has, since last year, significantly cut its exports of gallium and germanium – two metals key to the production of high-speed computer chips.
China dominates the supply of both metals, accounting for at least 60 per cent of global germanium production and nearly 90 per cent of the world’s gallium output, the report said.
Beijing’s recent moves to take charge of the supply chain include other obscure chemical elements that are also needed by semiconductor manufacturers.
On September 15, the country’s Ministry of Commerce restricted exports of antimony, a material used in semiconductors, military explosives and other weaponry.
National security officials have also tightened the flow of information about rare earths, labelling rare earth mining and refining as state secrets.
The materials are a battleground in the broader fight between China and the United States over advanced technology, including the semiconductors used for artificial intelligence.
Each side is imposing export controls on the components it produces, while trying to develop supply chains at home or abroad, with trusted allies.
The country’s Ministry of Commerce contends it is taking action to conserve scarce natural resources, discourage weapons proliferation and protect the country’s national security.
Rare earths from China are used in US-made F-35 stealth fighters as well as in wind turbines, electric car motors, camera lenses and the catalytic converters on gasoline-powered cars.
Follow us on
