Export Controls Begin
China’s decision to impose export controls on gallium and germanium beginning on Aug. 1 in response to U.S. export restrictions has Korean semiconductor, display, and battery industries on edge.
According to industry sources on July 31, the Korean semiconductor, display, and secondary battery industries are busy preparing countermeasures for China’s gallium and germanium export restrictions a day ahead of Aug. 1. The Korean industry is of the opinion that there is no immediate problem with the supply of these minerals as they can be imported from other countries. However, a concern is being raised that China’s dominance of these materials may pose a long-term threat.
“In order to protect national security interests, the export of gallium and germanium-related items will be controlled beginning Aug. 1,” China’s Ministry of Commerce announced on July 3. China accounts for about 80 percent of global gallium production and 60 percent of germanium production, according to the European Core Raw Materials Alliance (CRMA).
Gallium is used in next-generation semiconductors and organic light-emitting diode (OLED) display materials. In particular, gallium has been shining as a key material of the future, with foundries such as Samsung Electronics and DB High-Tech aiming to mass-produce gallium nitride (GaN) power semiconductors by 2025. Germanium is used in semiconductor process gases and space technologies such as solar cells. “There are no products that mainly use these materials yet, and they are used in very small amounts in manufacturing, so there is little impact on export controls,” a Korean semiconductor industry representative said.
A representative from the display industry also said that there was no immediate impact. “We are closely monitoring whether regulations will be strengthened in the long term and are preparing long-term measures such as diversifying supply lines,” he said.
However, there are analysts who believe that China’s export controls are the beginning, not the end. If it spreads to lithium, graphite, and rare earths, it raises the possibility of a second urea crisis in Korea.
“China’s export restrictions are unlikely to stop at gallium and germanium,” the MIT Technology Review recently said. “Lithium, cobalt, nickel, and other minerals that are in high demand and difficult to find alternative supply chains for in the short term are likely to be used as bargaining chips.” Lithium, often referred to as white oil, may become another item in the export restriction list. Korea has a stockpile of less than six days of lithium, a key raw material for secondary batteries, as of the end of May. The amount was far short of the Korea government’s target of 100 days.