CHINA on Tuesday banned exports to the United States of the critical minerals gallium, germanium and antimony that have widespread military applications, escalating trade tensions the day after Washington’s latest crackdown on China’s chip sector.
Top industry associations also urged Chinese companies to be wary of buying US chips as they are “no longer safe” and buy locally instead in a rare coordinated response to Washington’s curbs on Chinese chipmakers.
The two nations have targeted each other’s economies in the last few days, even before US President-elect Donald Trump returns to the White House in January. Trump has promised to impose heavy tariffs on imported Chinese goods, reviving a trade war from his first four-year term as president.
The export curbs strengthen enforcement of existing limits on critical minerals exports that Beijing began rolling out last year but apply only to the US market.
A Chinese Commerce Ministry directive on dual-use items with both military and civilian applications cited national security concerns. The order, which takes immediate effect, also requires stricter review of end-usage for graphite items shipped to the US.
“In principle, the export of gallium, germanium, antimony and superhard materials to the United States shall not be permitted,” the ministry said.
Gallium and germanium are used in semiconductors, while germanium is also used in infrared technology, fiber optic cables and solar cells. Antimony is used in bullets and other weaponry, while graphite is the largest component by volume of electric vehicle batteries.
The move has sparked fresh concern that Beijing could next target other critical minerals, including those with even broader usage such as nickel or cobalt.
“China has been signaling for some time that it’s willing to take these steps, so when is the US going to learn its lesson?” said Todd Malan of Talon Metals, which is trying to develop a nickel mine in Minnesota and is exploring for the metal in Michigan. The only US nickel mine will be depleted by 2028.
The United States was assessing the new restrictions, but will take “necessary steps” in response, a White House spokesman said, without giving details.
Representatives for Trump did not immediately respond to a request for comment.
Chinese customs data show there have been no shipments of wrought and unwrought germanium or gallium to the US this year through October, although it was the fourth- and fifth-largest market for the minerals, respectively, a year earlier.
Similarly, China’s overall October shipments of antimony products plunged by 97 percent from September after Beijing’s move to limit its exports took effect.
China accounted last year for 48 percent of globally mined antimony, which is used in ammunition, infrared missiles, nuclear weapons and night-vision goggles, as well as in batteries and photovoltaic equipment.
China has this year accounted for 59.2 percent of refined germanium output and 98.8 percent of refined gallium production, according to consultancy Project Blue.
“The move is a considerable escalation of tensions in supply chains where access to raw material units is already tight in the West,” said Project Blue co-founder Jack Bedder.
China’s announcement comes after Washington launched its third crackdown in three years on China’s semiconductor industry on Monday, curbing exports to 140 companies, including chip equipment maker Naura Technology Group.
Trump, whose first four-year White House term was marked by a bitter trade war with China, has said he will implement 10-percent tariffs on Chinese goods and threatened 60-percent tariffs on Chinese imports during his presidential campaign.
“It comes as no surprise that China has responded to the increasing restrictions by American authorities, current and imminent, with its own restrictions on the supply of these strategic minerals,” said Peter Arkell, chairman of the Global Mining Association of China.
“It’s a trade war that has no winners,” he said.
The industry associations’ warnings, meanwhile, could affect US chipmaking giants such as Nvidia, AMD and Intel, which despite export controls have managed to keep selling products in the Chinese market.
The associations cover some of China’s largest industries, including telecommunications, the digital economy, autos and semiconductors, and combined count 6,400 companies as members.
The statements, released shortly after each other, did not detail why US chips were unsafe or unreliable.
The Internet Society of China urged domestic companies to think carefully before procuring US chips and seek to expand cooperation with chip firms from countries and regions other than the United States, according to its official WeChat account.
The China Association of Communication Enterprises said it no longer saw US chip products as reliable or safe, and the Chinese government should investigate how secure the supply chain of the country’s critical information infrastructure was.
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