China’s ban on U.S.-bound critical mineral exports is “mineral extortion,” Washington D.C.-based National Mining Association (NMA) president Rich Nolan said on Wednesday.
The export ban announced a day earlier targets gallium, germanium, antimony and graphite. These minerals are needed for semiconductors, 5G phone tech, defence systems and electric vehicle batteries. Antimony is found in bullets. Nolan described the export ban as a calculated bid for geopolitical leverage.
“China has weaponized the world’s mineral supply chains,” he said in an emailed statement. “We must confront Chinese mineral extortion and recognize that U.S. mining policy is the foundation of our nation’s economic, energy and national security.”
The trade tension comes amid U.S. president-elect Donald Trump’s pledge last month to impose 25% duties on goods from Canada and Mexico, and 10% on products from China until they clamp down on illegal migrants and cross-border narcotics. Analysts said then a trade war could erupt.
And they’ve warned how the West will suffer if China expands its restrictions. A November U.S. Geological Survey report estimated a US$3.4 billion loss to American GDP if Beijing imposes a full ban on gallium and germanium exports.
Domination
China dominates global production and processing of gallium, germanium and antimony. It controls 89.4% of cathodes, 93.5% of anodes and over 80% of key lithium-ion battery components, the USGS report showed. The U.S. imports all its gallium.
Jack Lifton, co-chair of the Critical Minerals Institute, a multi-country effort to promote critical minerals, framed the issue as part of a global struggle for power over critical minerals.
Lifton stressed that the U.S. can produce these materials. It has the geological resources. But, it lacks the policies to create secure supply chains because some agreements dating from just after World War II, like the dollar-based trade regime created at Bretton Woods, are losing relevance. He questioned whether Washington could effectively challenge Beijing.
Tit-for-tat policy
China’s ban came a day after Washington tightened export controls on advanced chip-making equipment and high-bandwidth memory chips to Chinese firms. China’s Ministry of Commerce justified its response as a necessary step to safeguard its national security.
Like the U.S. miners, it used the word ‘weaponized’ to describe trade relations. The U.S. has been undermining global supply chains with years of restrictions on Chinese companies, ministry spokesperson Lin Jian said in a Tuesday press briefing.
Calls to cooperate
China’s ban has reignited calls from miners in the U.S. and Canada to reform their mining policies and reduce dependence on foreign supplies.
Canada-U.S. collaboration is vital to secure critical mineral supply chains, the Mining Association of Canada (MAC) said late Tuesday. In 2022, 52% of Canada’s mineral exports, worth over $80 billion, went to the U.S., according to association data.
MAC president Pierre Gratton called for boosting this partnership. He also noted that imposing Trump’s proposed tariffs on Canadian mineral and metal exports to the U.S. would run counter to the shared goals of secure and reliable supply chains.
Such measures risk disrupting the essential flow of these resources, undermining the competitiveness of North American industries, and exacerbating vulnerabilities in critical mineral supply chains that both nations are working to address.
“The minerals and metals industry in Canada stands ready to strengthen our partnership with the U.S., ensuring the free flow of these essential resources that drive economic growth and defense capabilities on both sides of the border,” he said.
I think you can take this a step further; they have weaponized the energy transition, we have been remarkably complacent, maybe even dumb.