CHINA STIMSON

China’s Germanium and Gallium Export Restrictions: Consequences for the United States

China’s new ban on germanium and gallium exports to the United States builds on earlier restrictions on the materials in July 2023. However, discrepancies between U.S. and Chinese trade data suggest that the materials are reaching the United States through trade via third countries. If China does not crack down on the reexport of these materials, the United States may be able to use this practice to help offset the impacts of the new ban.

With a recent focus on China’s export control measures on critical minerals, it is worthwhile to examine the effectiveness of China’s July 2023 export control measures on germanium and gallium,¹ critical materials that are used in many semiconductor manufacturing and other high-end manufacturing applications, as well as the recently announced export ban on them. The July 2023 controls required permission from the Chinese government to export the materials from China to any country, but did not ban the materials’ export outright.

Since the 2023 controls were imposed, China’s exports of both of these critical minerals have declined significantly, especially for the United States and its chip alliance partners. However, while Chinese official data shows zero exports of germanium and gallium to the United States in 2024, U.S. trade data shows imports from China coming in. The culprit, especially in the case of germanium, appears to be backdoor trade through third countries like Belgium.

In December 2024, China announced an official ban on the export of germanium and gallium to the United States.² Data shows that China is able to cut its exports, but backdoor third-country channels could still allow germanium and gallium to continue to flow to the United States.

Decline of Chinese Exports

Top receivers of Chinese germanium exports³ used to be Hong Kong,⁴ Germany, Russia, Japan, the United States, Belgium, and Taiwan.⁵ China’s exports to most of these partners declined sharply between 2022 and 2024, including 97–100% decline for exports to the United States and Taiwan and a 75% decline for exports to Japan. Exports to Hong Kong also zeroed out. Overall, China’s exports of germanium fell by 42%. Bucking the trend of this decline, however, Chinese exports to Belgium rose 224% from 2022 to 2024.

Top importers of China’s gallium before 2022 were Japan, Germany, and the Netherlands. Chinese gallium exports to the Netherlands and the United States—the primary two countries coordinating on chipmaking equipment export restrictions on China⁶—zeroed out from 2022 to 2024. Other partners coordinating on the restrictions also saw decreases: gallium exports to Japan were also down 36%, and exports to Canada, another coordinating partner,⁷ were also down 41% in the same period. Overall, China’s exports of gallium fell about 36% from 2022 to 2024. Fewer exports to the United States were a small part of that picture, accounting for only 3% of the loss.

Data Discrepancies and the Possibility of Reexport

Though Chinese data shows that no exports of germanium or gallium went to the United States in 2024, U.S. trade data tells a different story, showing 26% of its germanium imports (about 3,500kg) and 8% of its gallium imports (900kg) still came from China in 2024.⁸⁹

One possible explanation for the discrepancy is reexport through third countries. Chinese government regulation has left a loophole here; the General Administration of Customs China states that “in instances where the country of final destination cannot be ascertained, exports will be credited to the final country dispatched to as known at the time of exportation.” Some of the material reexported from a third country or region thus likely ends up classified in the United States as originating from China while other material ends up classified as originating from the reexporting country or region.

Belgium is the most likely source of reexported germanium. The volume of China’s exports of germanium to Belgium increased roughly 224% in 2024 relative to 2022 while Chinese germanium exports to the United States dropped to zero. Interestingly, the quantity of germanium exported to the United States fell in 2024 by roughly the same amount as the increase of its germanium exports to Belgium in the same period: in 2024, 5,900 fewer kilograms were exported to the United States while 6,150 more kilograms of germanium were exported to Belgium relative to 2023. China exported roughly the same amount of material to the two countries combined in both 2023 and 2024: 10,750kg and 11,000kg, respectively.

For gallium, the potential for reexport is more clouded by the possibility of increased secondary production; for example, top sources of U.S. gallium imports Canada¹⁰ and Germany¹¹ both have gallium recycling capacity but also import gallium from China. Germany has not produced any primary gallium of its own since 2016¹² and primarily imports gallium from China and Slovakia.¹³ But at the same time, Germany accounted for 22% of the United States’ gallium imports in 2024, a 1,111% increase relative to 2022. This could imply increased secondary production, but it could also imply German reexport.

Impact on the United States

Overall, the United States is importing less germanium than it did before, seeing a decrease of 68% from 2021 to 2024. The United States is also importing less gallium, falling 77% from 2021 to 2024.

At the same time, U.S. consumption of the two materials has not apparently declined. The January 2024 USGS reports higher levels of gallium consumption in 2022 and 2023¹⁴ relative to 2020 and 2021 and estimates consumption of germanium has remained flat.¹⁵ As we have seen, reexport helps. Other possible explanations include increased recycling and domestic processing and, for germanium, the ability to tap into the domestic stockpile.

Implications for China’s New Export Ban

In December 2024, China announced an official ban on the export of germanium and gallium to the United States.¹⁶ The USGS has estimated such a total ban could cause a 150% increase in price for gallium and a 26% increase for germanium and constrain supply, leading to a $3.4 billion decrease in U.S. GDP.¹⁷

China does have the ability to cut its exports, at least on paper, as evidenced by its zero reported exports to the United States. However, backdoor third-country channels have apparently allowed critical minerals to continue to flow to the United States. Producers ramping up secondary production and new production efforts may have also helped to offset the impacts on the United States of Chinese restrictions on germanium and gallium exports.

Should China crack down on the export of material to known conduit third countries under the new ban, the effects on the United States could be drastic. In this event, partner countries increasing their production alone may not be able to help the United States make up for shortfalls in supply; the USGS notes that such production may not be immediately available¹⁸ in the event of increased supply needs. New plants take time to come online, and increasing output at existing plants does not happen overnight. The U.S. germanium stockpile can help make up for urgent shortfalls for germanium, but the lack of a comparable gallium stockpile could make the United States more likely to face stronger effects from a severe crackdown on export of gallium to partner countries that could reexport the material. As a result, the full impact on the United States of China’s new ban will depend on how much China controls exports to third countries and whether U.S. companies and partners can add new production capacity in time.

Notes

1
Government of the People’s Republic of China, Ministry of Commerce, “商务部海关总署公告2023年第23号关于对镓、锗相关物项实施出口管制的公告,” July 3, 2023. https://m.mofcom.gov.cn/article/zwgk/gkzcfb/202307/20230703419666.shtml
2
Elaine Kurtenbach, “China bans exports to US of gallium, germanium, antimony in response to chip sanctions,” AP, December 3, 2024, https://apnews.com/article/china-us-tech-semiconductor-chip-gallium-6b4216551e200fb719caa6a6cc67e2a4.
3
Unless otherwise noted, all analysis of China’s exports relies on data from China’s General Administration of Customs, accessed in January and February 2025, including both wrought and unwrought germanium and gallium but excluding germanium oxides.
4
Hong Kong is coded in China’s customs data as “Hong Kong, China.”
5
Taiwan is coded in China’s customs data as “Taiwan, China.”
6
Ana Swanson, “Netherlands and Japan Said to Join U.S. in Curbing Chip Technology Sent to China,” New York Times, January 28, 2023, https://www.nytimes.com/2023/01/28/business/economy/netherlands-japan-china-chips.html.
7
CSIS, ““Guardrails” on CHIPS Act Funding to Restrict Investments in China May Restrict Participation in CHIPS Act Incentives,” Sujai Shivakumar, Charles Wessner, and Thomas Howell, November 7, 2023, https://www.csis.org/blogs/perspectives-innovation/guardrails-chips-act-funding-restrict-investments-china-may-restrict.
8
China’s General Administration of Customs says its exports are recorded for the country that is the final destination, and the United States Census Bureau lists imports by the country that is the original producer unless the product has undergone substantial transformation in a third country on the way, from Government of the People’s Republic of China, “Explainatory Notes of 2024,” General Administration of Customs, March 12, 2024. http://english.customs.gov.cn/Statics/730a6583-f241-4f04-a10b-af9c6ff8a164.html and U.S. Census Bureau employee, January 2025.
9
Unless otherwise noted, all U.S. import data is from the United States Census Bureau’s online trade database, and includes wrought and unwrought germanium excluding oxides as well as unwrought gallium.
10
Maddie Stone, “Metals Crucial to Clean Energy Are Getting Caught Up in the US–China Trade War,” Wired, February 15, 2025, https://www.wired.com/story/2-obscure-clean-energy-metals-are-caught-in-the-crosshairs-of-the-us-china-trade-war/.
11
Government of the Federal Republic of Germany, Federal Institute for Geosciences and Natural Resources, German Mineral Resources Agency, “DERA Rohstoffinformationen: Status quo of recycling in metal production and processing in Germany,” Michael Liesegang and Britta Bookhagen, August 2023. https://www.bgr.bund.de/DE/Gemeinsames/Produkte/Downloads/DERA_Rohstoffinformationen/rohstoffinformationen-57-en.pdf?__blob=publicationFile&v=3
12
Government of the United States of America, Department of the Interior, United States Geological Survey, “Gallium,” Brian W. Jaskula, January 2024. https://pubs.usgs.gov/periodicals/mcs2024/mcs2024-gallium.pdf
13
ISE AG, “Export controls on gallium and germanium: “China wants to negotiate”,” Arndt Uhlendorff, September 2023, https://en.institut-seltene-erden.de/ausfuhrkontrollen-auf-gallium-und-germanium-china-will-verhandeln/.
14
The figure for 2023 is estimated.
15
Government of the United States of America, Department of the Interior, United States Geological Survey, “Gallium,” 2024. and Government of the United States of America, Department of the Interior, United States Geological Survey, “Germanium,” Amy C. Tolcin, January 2024. https://pubs.usgs.gov/periodicals/mcs2022/mcs2022-germanium.pdf
16
Elaine Kurtenbach, “China bans exports to US of gallium, germanium, antimony in response to chip sanctions.”
17
Government of the United States of America, Department of the Interior, United States Geological Survey, “USGS Critical Minerals Study: Bans on Gallium and Germanium Exports Could Cost the U.S. Billions,” November 19, 2024. https://www.usgs.gov/news/national-news-release/usgs-critical-minerals-study-bans-gallium-and-germanium-exports-could
18
Government of the United States of America, Department of the Interior, United States Geological Survey, “Quantifying Potential Effects of China’s Gallium and Germanium Export Restrictions on the U.S. Economy,” Nedal T. Nassar, Ensieh Shojaeddini, Elisa Alonso, Brian Jaskula, and Amy Tolcin, 2024. https://pubs.usgs.gov/of/2024/1057/ofr20241057.pdf

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