China’s recent decision to ban exports of several critical minerals has dealt a blow to key American industries, underscoring the high stakes in the ongoing trade war between the world’s two largest economies.
Last week, China’s Commerce Ministry announced new export bans on shipments of antimony, gallium, germanium, and “superhard materials” to the United States.
The move retaliates against Washington’s tightened controls designed to restrict China’s access to advanced semiconductor technologies, which the U.S. views as a national security threat due to the potential military applications.
Newsweek reached out to the Chinese Foreign Ministry and U.S. Geological Survey by email with requests for comment.
The impacts of the Chinese export bans have further raised concerns in Washington over the vulnerability of U.S. industries that are reliant on Chinese minerals and the urgent need to secure alternative sources.
In its announcement, China’s Commerce Ministry accused Washington of “politicizing and weaponizing” trade and technology. This move is the latest salvo in the escalating trade war, which has included tariffs and counter-tariffs on both sides.
Some analysts believe China’s new export restrictions signal a warning to the incoming administration of President Donald Trump, who has repeatedly promised to increase tariffs on Chinese goods.
Among those affected are the following three invaluable industries:
Semiconductors
China accounts for 98 percent of global gallium production, according to the U.S. Geological Survey. Gallium is essential for advanced semiconductors, particularly those used in high-frequency and high-power applications.
Miguel J. Rodriguez/AFP via Getty
Compounds like gallium arsenide (GaAs) and gallium nitride (GaN) outperform traditional silicon-based semiconductors in efficiency, speed, and heat resistance. These properties make gallium-based semiconductors indispensable in radar systems, avionics, and communication equipment for modern aircraft and military applications.
Without a reliable supply of gallium, the U.S. semiconductor industry faces significant disruptions, potentially slowing the development and production of advanced electronics.
Space
China also dominates the production of germanium, controlling 60 percent of the global supply, according to the Critical Raw Materials Alliance industry body. Germanium is crucial for high-efficiency solar cells, particularly those used in space-based applications.
Germanium’s ability to endure high radiation and extreme temperatures makes it ideal for powering satellites and other spacecraft. This includes vital systems like GPS, surveillance, weather, scientific, and defense communication satellites. Any disruption in the supply of germanium threatens the reliability and deployment of these space-based assets, which are critical for national security and infrastructure.
Manufacturing
“Superhard materials” such as synthetic diamonds and cubic boron nitride are essential for cutting, grinding, and shaping metals, ceramics, and composites with extreme precision. These materials are used in aerospace, automotive, and industrial manufacturing.
The manufacturing sector accounted for 10 percent of the U.S. gross domestic product (GDP) in 2023, according to the Bureau of Economic Analysis. Disruptions in the supply of superhard materials could hinder the production of high-precision components, affecting industries that rely on advanced machining and tooling.
Economic Impact
In a recent report, the USGS assessed the economic impact of potential supply disruptions.
The study determined a full ban on gallium could reduce U.S. GDP by as much as $3.1 billion, while a ban on germanium could cost $0.4 billion. If both were restricted, the combined loss could reach $3.4 billion. U.S. GDP was reported to be $27.7 trillion in 2023.
