The Elements of Innovation Discovered
The Elements of Innovation Discovered
Metal Tech News - December 4, 2024
Gallium and germanium are critical to the semiconductors for computer chips that go into everything from household appliances to the most powerful supercomputers.
Antimony is a strategic element needed for ammunition, fireproofing compounds, night vision goggles, and other military gear.
High-grade antimony sample stibnite collected from Nova Minerals' Estelle project in Alaska.
Gallium is a tech metal that melts at 85.6 F.
Germanium is a powerful superconductor.
Estimated net decrease in U.S. gross domestic product at different levels of restrictions of China's net exports of A, gallium or B, germanium, by industry.
In a move that could deal a multibillion-dollar blow to the American economy and impact the nation's military readiness, China has completely banned the exports of gallium, germanium, antimony, and superhard materials to the United States.
Gallium and germanium are essential ingredients for semiconductors used to make computer chips; and antimony is needed for ammunition and a wide range of technologies for both military and consumer applications. While China did not define what constitutes superhard materials, this group usually includes high-strength products made from critical metals like tungsten, rhenium, and osmium.
China's Ministry of Commerce said any individual or organization that ships gallium, germanium, antimony, or superhard materials that originated in China to organizations or individuals in the U.S. "will be held accountable according to law."
These strict export restrictions come just one day after the White House announced that an additional 140 Chinese-owned companies have been blacklisted from receiving computer chip-making equipment and related technologies, as well as high-bandwidth memory chips from the U.S.
During a Dec. 3 briefing, Chinese Foreign Ministry Spokesperson Lin Jian said the U.S.'s escalating chip-making bans are a "malicious suppression of China's technological progress."
China, however, dominates the supply of the mined materials American manufacturers need to make computer chips, as well as the antimony that is strategic to the U.S. military and the key mineral inputs for superhard material.
The communist nation's ban on exports of these materials is expected to deal a blow to the U.S. economy and will likely spur the U.S. Department of Defense and Washington lawmakers to further ratchet up its efforts to secure reliable supplies of these materials in the U.S. and allied countries.
Gallium is a tech metal that melts at 85.6 F.
Germanium is a powerful superconductor.
In November, the U.S. Geological Survey published a report that estimates that a complete Chinese ban on exports of gallium and germanium to the U.S. could send America's gross domestic product (GDP) plummeting by $3.4 billion.
According to data compiled by USGS, China supplies roughly 98% of the world's gallium and a significant portion of harder-to-track germanium. This leaves American manufacturers with few alternatives for these semiconductor materials critical to high-tech, clean energy, and military readiness.
China's 2023 implementation of policies that require government approval for all gallium and germanium exported out of the country was the impetus for USGS to develop a model that evaluated the potential economic impacts if China used these mechanisms to cut off exports to America.
"Modern technology and manufacturing depend on reliable supplies of minerals, so it makes sense for the USGS to track mineral supply chains and develop approaches to scan the horizon for potential disruptions," said USGS Director David Applegate.
Estimated net decrease in U.S. gross domestic product at different levels of restrictions of China's net exports of A, gallium or B, germanium, by industry.
According to the USGS model, roughly 40% of the blow to America's GDP would be concentrated in the semiconductor device manufacturing sector. These losses would trickle down to other high-tech manufacturers, automakers, and a wide network of other sectors of the economy that utilize electronic devices with gallium- or germanium-enabled computer components.
USGS calculates that 88% of the estimated GDP loss would come from American manufacturers being cut off from gallium, considering that China and Russia account for 99% of the global supply of this tech metal.
In a report released on Nov. 20, USGS estimated that the worst-case scenario of a complete ban on exports could send the price of germanium rocketing more than 150% and push the price of germanium up by roughly 26%.
Higher costs for these metals, however, are less troublesome than the inability to produce semiconductors needed for a broad spectrum of the economy.
"Losing access to critical minerals that make up a fraction of the value of products like semiconductors and LEDs can add up to billions of dollars in losses across the economy," said Nedal Nassar, lead author of the gallium and germanium study. "The USGS has the expertise and the responsibility to help assure access to minerals and supply chain resilience."
While it is expected that the U.S. will find alternative sources of gallium and germanium, the impacts of supply disruptions that were only two weeks out on the horizon from the publishing of the model will be acute.
"Our model projects the impacts in the near term and in many cases developing new supply sources or substitute materials takes far longer," Nassar said.
DOD is likely as concerned, if not more so, about the antimony export ban as it is about the gallium and germanium bans.
China (48%), Tajikistan (25%), and Russia (5%) control nearly 80% of the world's antimony supply.
American manufacturers use nearly 50 million pounds of antimony each year for ammunition, batteries, electronics, fireproofing compounds, specialty glass, and other products.
A heavy dependence on Russia and China for a metalloid that is both critical to the American economy and strategic to its military is not something that many U.S. policymakers and Pentagon brass are comfortable with.
Antimony is a strategic element needed for ammunition, fireproofing compounds, night vision goggles, and other military gear.
In a 2022 report, the U.S. House Armed Services Committee said it "is concerned about recent geopolitical dynamics with Russia and China and how that could accelerate supply chain disruptions, particularly with antimony."
These anxieties were elevated earlier this year when China required government approvals of antimony exports with a mechanism similar to those previously installed to control exports of gallium, germanium, and graphite.
Even before the antimony export control mechanism was put in place, DOD was proactively investing in secure and reliable domestic supplies of antimony.
Toward this objective, DOD awarded Perpetua Resources Inc. $59.4 million in Defense Production Act (DPA) Title III funding to complete studies necessary to finalize permitting of Stibnite, a gold project in Idaho that could also supply roughly 35% of America's current antimony.
To help get this domestic antimony supply online as early as possible, the Export-Import Bank of the United States (EXIM) offered to loan Perpetua $1.8 billion to fund the construction of the Stibnite gold-antimony mine.
"We are seeing a whole-of-government approach to bring antimony production home," said Perpetua Resources President and CEO Jon Cherry.
DOD has also been looking north to Alaska, a state known to host some of the highest-grade antimony discoveries in the U.S.
Two companies are advancing high-grade antimony projects in Alaska – Felix Gold Ltd. on its Treasure Creek project a few miles north of Fairbanks and Nova Minerals Ltd. on the Estelle property about 100 miles northwest of Anchorage.
High-grade antimony sample stibnite collected from Nova Minerals' Estelle project in Alaska.
Nova Minerals CEO Christopher Gerteisen says DOD has expressed strong interest in establishing a pilot-scale operation to mine antimony at Estelle and build a plant that could process high-grade antimony mined in Alaska.
Given China's near-complete control over antimony processing, developing a domestic plant capable of upgrading the antimony mineral stibnite into products for military, high-tech, and clean energy applications is a high priority for the Pentagon.
Nova says it is well advanced within the DOD grant application process to potentially rapidly develop the antimony and other critical minerals prospects identified across the Estelle property.
Given the economic and national security implications of China's ban, it can be expected that this application is now at the top of the pile and that DOD and U.S. policymakers will move quickly to shore up secure supplies of antimony, gallium, germanium, and superhard materials.
With more than 16 years of covering mining, Shane is renowned for his insights and and in-depth analysis of mining, mineral exploration and technology metals.
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