China’s recent export ban on critical minerals – including gallium, germanium, antimony, and superhard materials – has sparked discussions on potential opportunities for Australia. However, the scale and timing of these benefits remain uncertain, according to AMP chief economist Shane Oliver.
The ban, announced by China’s Ministry of Commerce last week, also includes tighter export controls on dual-use graphite materials.
These measures came just a day after the outgoing Biden administration introduced fresh export controls and sanctions aimed at curbing the sale of advanced US microchips and semiconductor manufacturing technology to China.
China’s “quick response” is seen as retaliation against the US, marking a significant shift towards a more assertive stance compared to previous years.
According to Oliver, this indicates that global trade conflicts are “on the rise”.
“I think that in a broader sense, it highlights that trade conflict is on the [rise] globally even before Donald Trump comes on the scene and they are likely to intensify,” Oliver told InvestorDaily.
He noted that China’s current approach is more aggressive than in 2018.
“It is a warning that trade conflict is on the rise and [there] would be more issues as we go through the next year.”
China dominates global production of gallium and germanium, supplying 94 per cent and 83 per cent of these critical minerals, respectively, according to a European Union study on critical raw materials, as reported by Bloomberg News.
Gallium is essential for semiconductors, electric vehicles and wind power generators, solar photovoltaics and batteries, while germanium has key applications in fibre-optic systems, infrared optics, solar cell applications, and light-emitting diodes.
According to CSIRO, gallium and germanium are among Australia’s unsung critical minerals, and they are, like many critical minerals, typically not mined directly but are by-products of the processing of other minerals.
Although Australia’s production is currently limited, both minerals hold significant potential for Australia, CSIRO noted.
Oliver agreed that China’s ongoing tensions with the US present a long-term opportunity for Australia, but cautioned that it will take time, given the extended timelines for such projects.
“The short answer is, yes, there is an opportunity for Australia to supply these minerals, but it may take time to ramp up the production,” Oliver said.
“It is one of these things we are not as significant as major producers like China but it sounds like there is a potential to ramp it up.”
A lack of data on the precise size of these resources in the country means it is hard to determine the size of these opportunities.
“That is something that it takes time to do and Australia cannot just jump in straight away,” he said, noting that the potential was “relatively constrained in the short-term”.
Dr Chris Vernon, CSIRO Critical Minerals R&D hub lead, stated earlier this year that gallium and germanium have been gaining attention due to their strategic importance and China’s dominance in their production.
“However, there are many other critical mineral markets Australia could have a role in,” Vernon said in June.
“Australia’s potential in the critical minerals market is immense. Particularly now, with lesser-known minerals like gallium and germanium playing pivotal roles in modern technology and renewable energy.”
Shares of Australia’s Lynas Rare Earths, the largest producer of rare earth minerals outside China, surged to a near three-week high last week, following China’s announcement of the export ban.
