Galliu

Chinese export controls on certain gallium and germanium products take effect today, Tuesday 1 August, and operators are bracing for a drop in international supply in August and September as exporters work out the necessary new permits.

China, the world’s top supplier of the two minor metals used in semiconductor production, announced restrictions on exports of eight gallium products and six germanium products in early July, citing national security concerns.

According to the Chinese Ministry of Commerce, from Tuesday, exporters of these products will have to apply for export licences for dual-use products and technologies, i.e. with potential military and civil applications.

It usually takes about two months to obtain these licences. It is not clear how many licences will be issued, nor whether their number will be limited. Stocks outside China, which could last two to three months, will have to be exploited while traders wait for Beijing’s approval of export permits.

At the same time, export restrictions are expected to cause a growing surplus of products in China. Bid prices for gallium ingots rose by 5 per cent to EUR 232/kg from EUR 221/kg a week earlier.

Gallium metal 99,99%min FOB – China euro/kg – Powered by Commodity Evolution

Offers for germanium ingots in Rotterdam rose by 4.92% to EUR 1,342/kg (28 July) from EUR 1,279/kg the previous week.

Germanium metal 99.99%min Delivered – Europe euro/kg – Powered by Commodity Evolution

Prices are expected to rise and remain strong in the coming months, before cooling by the end of the year, as Chinese exports and overseas supply are expected to improve.

Chinese exports of wrought germanium and germanium products in the first half of the year amounted to 27,825 kg, up 75.5% year-on-year, according to customs data. Exports of wrought gallium and gallium products totalled 17,565 kg, down 53.5%.