China has announced that it will place controls on exports of eight gallium products and six germanium products from the beginning of August to protect, what it says, is its national security.
The decision is seen by analysts as a response to escalating efforts by the United States to curb China's technological advances which has seen not only the US but Japan and the Netherlands place restrictions on semiconductor manufacturing technology exports to China.
In response many companies have already sought to secure supplies and according to a report from Reuters, a China-based germanium producer said that enquiries from buyers have surged pushing prices higher.
Analysts have also expressed concerns that China could follow this move with additional restrictions on rare earth exports, after curbing shipments 12 years ago in a dispute with Japan. Rare earths are a group of metals critical to many applications and China is by far the world's biggest producer.
China produces most of the world's gallium and germanium and last year top importers of gallium products were Japan, Germany and the Netherlands, while for geranium Japan, France, Germany and the US were the main importers.
While there are concerns as to the impact this move will have on supplies and, in turn, prices, officials in Taiwan and South Korea have downplayed the risks of any disruption. While that may be the case on the short term, there are concerns that over the longer term it could have a serious impact on the semiconductor industry.
