In the past, we often heard that the United States would often use "de-risking" and "national security" as an excuse not to sell China and ban China, but now it is finally the turn of the United States to taste the embargo, and this taste makes the United States quite uncomfortable. Recently, Chinese customs data showed that since July 2023, China's exports of gallium and germanium to the United States have been completely stopped. At the same time, China's gallium exports to Japan fell sharply by nearly 3/4, and germanium exports to Japan also decreased by 1/3. Starting in August 2023, China announced export controls on gallium and germanium-related items. At the time, some people questioned whether it would not be implemented in place, but now it seems that exports to the United States were completely stopped a month in advance, and this time the countermeasures were precise and swift. Both gallium and germanium are key materials in the production of advanced chips, most of which are made in China. In the future, if American companies want to buy these materials, it is estimated that they can only use leather bag companies for entrepot trade or smuggling, but the review must be very strict, and it is likely that they will be recycled from waste materials such as washing machines and chargers as previously recommended by the US Department of Defense. During the conflict between Russia and Ukraine, the United States also laughed at Russia because of this, and now the boomerang has hit itself.
Over the years, the United States and Europe have blockaded China in many technology industries, and former US President Donald Trump's tenure has launched a "technology war" against China, imposing restrictions on China in the high-tech field. And China did not fight back much, not because it did not, but because it did not start fighting. Looking at China's current dominance in key materials, it shows that the time has come, and the gallium and germanium embargo is a start.
At the end of last year, China also optimized and adjusted the temporary export control measures for graphite items. Subsequently, the relevant departments also issued an announcement on the "Catalogue of Technologies Prohibited and Restricted from Export in China", which involved in the prohibition of exports, "rare earth refining, processing and utilization technology", including rare earth extraction and separation technology, rare earth metal and alloy material production technology, as well as NdFeB, samarium cobalt, cerium magnet preparation technology and rare earth calcium borate oxide preparation technology. What impact will this have on the United States and the West, take rare earth magnet production technology as an example, the world's electric motors, artillery fuses, wind turbine magnetic fields, etc., all need rare earth magnets monopolized by China's technology. For decades, China was the only country in the world capable of mass-producing rare earth magnets from start to finish, accounting for more than 90% of the world's production capacity. At present, there are many basic materials for artillery shells and explosives, which only China can produce on a large scale and supply the whole world. For a nitrocellulose cotton, China's output accounts for as much as 70% of the global proportion. NdFeB magnets are the strongest and most demanded permanent magnets, and they are essential components for electric vehicles.
In fact, the importance of basic materials has long been ignored by the "de-industrialized" West, while China has been trying to break through the refining technology and step up the time layout. When the West reacted and was still trying to lay out and process "light rare earths", including neodymium rare earths and neodymium-praseodymium mixed rare earths, China has refined 99.9% of the world's "heavy rare earths". In recent years, the Western media has repeatedly published articles calling for a reduction in reliance on China's critical materials and an effort to catch up with China. But it's almost impossible to do it in the short term, so the rare earth card is played beautifully and the timing is very precise.