 |
| Photo: STAFF/REUTERS |
Beijing’s export restrictions on two minerals this week show it is willing to use its dominance to rock Western supply chains
China’s decision this week to restrict the export of two minerals used in semiconductors, solar panels and missile systems was more than a trade salvo. It was a reminder of its dominant hold over the world’s mineral resources—and a warning of its willingness to use them in its escalating rivalry with the U.S.
Around two-thirds of the world’s lithium and cobalt—essential for electric cars—is processed in China. The country is the source of nearly 60% of aluminum, also used in EV batteries, and 80% of polysilicon, an ingredient in solar panels. It has an even tighter grip on rare-earth minerals that go into crucial technologies, like making smartphone touch screens and missile-defense systems, accounting for 90% of their refining, according to the International Energy Agency.
Chinese companies also often control processing that isn’t done at home. A significant share of the world’s nickel supply, for instance, comes directly from China, but much of the rest is also in Chinese hands, refined by companies from China in places such as Indonesia and Papua New Guinea.
On Friday, Treasury Secretary Janet Yellen told U.S. businesses in China that the Biden administration was still evaluating Beijing’s decision announced Monday to restrict the export of gallium and germanium, but the move was a reminder of the importance of diversified supply chains.
China’s hold over the world’s minerals gives it the power to potentially disrupt the West’s energy transition, chip manufacturing and defense industries as its great-power rivalry with the U.S. heats up. A Chinese move to restrict exports of, say, lithium or cobalt would hit non-Chinese automakers hard, throwing the production of electric-car batteries into disarray.
Such extreme measures are unlikely in the near term, not least because they would also hurt Chinese businesses, but experts say they aren’t off the table.
“We would be foolish to limit our thinking that that kind of thing is impossible,” said Morgan Bazilian, director of the Payne Institute for Public Policy at the Colorado School of Mines. “If you keep ratcheting up your tit-for-tat, that’s one area it could go.”
Beijing’s restrictions on the export of gallium and germanium followed U.S. steps in October to limit Chinese access to equipment used to make advanced chips. The Chinese curbs are expected to add urgency to Western efforts to develop alternative mineral sources. --->READ MORE HERE
 |
| REUTERS/Florence Lo/File Photo |
China said on Monday it will impose export restrictions on gallium and germanium products used in computer chips and other components to protect national security interests.
The decision, widely seen as retaliation for U.S. curbs on sales of technologies to China, raised concerns that China might eventually limit exports of other materials, notably rare earths, whose production China dominates.
In 2010, China restricted exports of rare earths to Japan following a territorial dispute, sending prices soaring and Japan scrambling to find alternative sources. Beijing said the curbs were based on environmental concerns.
Below are some facts about rare earths, about China's dominance of the sector, and what countries are doing to ease their dependence on China for the materials.
WHAT ARE RARE EARTHS AND HOW ARE THEY USED?
Rare earths are a group of 17 elements used in products from lasers and military equipment to magnets found in electric vehicles, wind turbines, and consumer electronics such as iPhones.
The 17 elements are: lanthanum, cerium, praseodymium, neodymium, promethium, samarium, europium, gadolinium, terbium, dysprosium, holmium, erbium, thulium, ytterbium, lutetium, scandium, yttrium.
HOW DOMINANT IS CHINA IN THE RARE EARTHS SUPPLY CHAIN?
Mining: China accounted for 70% of world mine production of rare earths in 2022, followed by the United States, Australia, Myanmar and Thailand, United States Geological Survey (USGS) data shows.
Processing: China is home to at least 85% of the world's capacity to process rare earth ores into material manufacturers can use, according to research firm Adamas Intelligence in 2019.
Exports: Chinese exports of rare earths have declined. The country exported 20,987 metric tonnes in the first five months of 2023, down 4.4% year-on-year, Chinese customs data showed. --->READ MORE HEREFollow link below to a relevant story:
+++++America Dropped the Baton in the Rare-Earth Race+++++
If you like what you see, please "Like" and/or Follow us on FACEBOOK here, GETTR here, and TWITTER here.
No comments:
Post a Comment