Exports of gallium and germanium have stalled since China's export controls came into force. The prices for both raw materials, but also for indium, have risen in recent weeks.
In July 2023 the news portal Rohstoff.net reported on China's planned export controls for technology metals Gallium and Germanium. These came into force on 1 August, and since then Chinese companies have required a licence from the Ministry of Commerce to export the two technology metals. The requirements relate to so-called dual-use goods, which can be used for both military and civilian purposes, for example in the manufacturing industry. These are justified on the grounds of China's national security.
As a result of the restrictions, export volumes from the People's Republic fell in August strongly back and were at times zero for certain forms of delivery of these raw materials. One reason for this may also be the long lead times from the application to the granting of licences for exports, which in some cases amount to around 60 days. This development led to a shortage of gallium on the market and a simultaneous increase in demand, as Reuters writes.
Technology metal values rise at different rates
The full extent of the Chinese restrictions remains to be seen due to the long processing times for export applications, but the first effects on commodity trading are already becoming apparent. New information is available for buyers of and those interested in strategic metals as tangible assets. For example, the prices of the two raw materials gallium and later also germanium rose following the announcement of the export controls in July. Since the export restrictions came into force on 1 August, both metals have risen, in some cases by more than 40 per cent.
With Indium the prices of another technology metal have risen sharply since July. The largest price increase for all three metals was recently recorded for gallium, which rose by more than 40 per cent and reached its highest value since February in October. This is followed by indium, which has recently risen by at least 30 per cent, while the price of germanium has risen by at least 9 per cent.
Price development of gallium and germanium
Matthias Rüth, Managing Director of raw materials supplier TRADIUM GmbH, assesses the current developments as follows: "The rise in metal prices is only partly the result of increased demand on the market. One factor that plays an equally important role is China's supply difficulties, as Chinese companies are currently barely able to export, if at all. In the medium term, the situation on the raw materials market is expected to calm down again."
China plans further export restrictions
Industry observers see the export licences demanded by the People's Republic as a reaction to the current US export restrictions on the latest generation of semiconductor chips. While the long-term effects of the export controls for gallium and germanium are still unclear, China has announced export controls for another critical resource. This time it concerns graphite, an important battery material for electromobility. Licences will be required for this from 1 December, as the Industry service Rohstoff.net reported last week. As with gallium and germanium, China is the largest producer here. Producer.
According to analysts, however, it is unclear how great the impact of these new measures will be, reports Reuters. Export restrictions on other raw materials are also conceivable, with rare earths being mentioned as a possible target.
