Major Foundries Not Too Concerned About China's Restrictions on Rare Metal Exports

[T0@st]

China announced on Monday (June 3) that it would restrict exports of two rare metals——both crucial materials in the computer chip manufacturing process. The nation's Ministry of Commerce stated that their new measures were necessary to "safeguard national security and interests". The Chinese government is contending with several sanctions from Western countries—most notably their access to advanced semiconductor manufacturing equipment is now heavily controlled. Reuters has contacted a number of foundries about the potential impact of rare material shipment limitations. Taiwan Semiconductor Manufacturing Company (TSMC) has shrugged it off as a minor inconvenience, their spokesperson stated: "After evaluation, we do not expect the export restrictions on raw materials gallium and germanium will have any direct impact on TSMC's production. We will continue to monitor the situation closely."

WIN Semiconductors Corp—a Taiwanese firm that specializes in the provision of gallium arsenide wafers—informed the news agency about its low-level reliance on Chinese mineral sources. They are able to sidestep and procure gallium and germanium from suppliers located in Germany, Japan, and North America. The Japanese Semiconductor Equipment Association stated that it was too early to tell whether China's export restrictions will result in material shortages. Supply chains could be disrupted to some degree due to China controlling over 90% of the world's gallium and germanium production, but DigiTimes Asia proposes that new sanctions will not prohibit production and export activities. According to experts in the field supply lines will continue to operate, with buyers required to jump through some extra hoops in order to gain approval for certain market segments. The purification of gallium and germanium is mostly controlled by American and Japanese entities—the processed form of these metals is used in semiconductor production—DigiTimes reckons that these firms will probably feel the initial impact of new trade restrictions.



Suppliers could pivot and promptly find other mineral sources, but prices are expected to be greater when compared to Chinese ores. An industry expert proposes that China could upgrade its refining operations and offer purified gallium and germanium, thus out muscling competition in the U.S and Japan. On the other hand, new restrictions could scupper these internal refinement plans. GaAs and GaN industries could be disrupted to some extent (by the latter scenario)—the DigiTimes contact suggests that suppliers should re-evaluate their reliance on a single source of ore, even if it requires shelling out a bit more cash.

View at TechPowerUp Main Site | Source

 

[ExcuseMeWtf]

Of course they're not concerned, they can just jack up prices in face of lower supply.

 

[kapone32]

Though we have much better safety and Commercial standards Canada has plenty of these metals. We just have to share it with the people that actually own this land.

 

[AnotherReader]

Though we have much better safety and Commercial standards Canada has plenty of these metals. We just have to share it with the people that actually own this land.

The USGS's annual mineral commodity summaries indicate that there are other countries that have rare earth elements (a misnomer as they are far from being rare). However, as the methods for mining it are deleterious for the environment and neighbouring communities, production outside China is relatively low.

Source: USGS annual mineral commodity summary for Rare Earths: 2023 (PDF)

 

[bobsled]

Though we have much better safety and Commercial standards Canada has plenty of these metals. We just have to share it with the people that actually own this land.

Who would that be?

 

[kondamin]

The choice of gallium and germanium surprise me.
While the majority of it's production and refinement is located in China.

Those two are produced and refined all over the world and both metals get recycled 80% for germanium and 40% for gallium.

it's as if they want us to step up our recycling game.

 

[R0H1T]

India has more reserves than US+Canada

 

[kondamin]

India has more reserves than US+Canada

Known reserves, just look at Vietnam that has about the same as Russia.

 

[R0H1T]

Wonder if they counted the recent Lithium discovery up north.

 

[kondamin]

Wonder if they counted the recent Lithium discovery up north.

That’s not a rare earth.
lithium is one of the most abundant minerals on the planet

 

[ExcuseMeWtf]

That’s not a rare earth.
lithium is one of the most abundant minerals on the planet

You are right lithium is not rare earth, but not because of abundance. Rare earth refers to specific group of chemical elements, lithium just happens to not be one of them:

Rare-earth element - Wikipedia

en.wikipedia.org

 

[deb]

anyone know what "safeguard national security and interests" means?

 

[Vayra86]

anyone know what "safeguard national security and interests" means?

Synonymous for 'We dont like this, so just no.'

 

[kondamin]

anyone know what "safeguard national security and interests" means?

That it's an important mineral China and the Chinese market needs to prosper.

But it's just a tit for that measure that screws the global economy even more than it already is post covid insanity, energy mismangement and the ukraine mess.

 

[Minus Infinity]

I know Australia is rapidly ramping up production of rare earth's and US is investing billions in this area too.

 

[kondamin]

I know Australia is rapidly ramping up production of rare earth's and US is investing billions in this area too.

even europe is moving quickly to get their own supply going.
it's strange China is playing this card now.