China's metal export curbs reignites global companies' hunt for stable suppliers

Source: Reuters

China's metal export curbs reignites global companies' hunt for stable suppliers

Brenda Goh, Supantha Mukherjee and Kanishka Singh
Wed, July 5, 2023 at 4:05 PM EDT·4 min read

SHANGHAI/STOCKHOLM/WASHINGTON (Reuters) -China's decision this week to restrict exports of some strategic metals has prompted more companies to re-think their reliance on the world's No. 2 economy at a time when mounting geopolitical tensions have fed fears that more curbs could be coming.

In a move that a top Chinese trade advisor warned was "just a start," Beijing said on Monday it would limit exports of products made from the minor metals of gallium and germanium to protect national security. That followed the U.S. decision to impose export restrictions to curb China's access to key technologies used for artificial intelligence (AI).

The products China cited are used in semiconductors, defense technology and other high-tech industries. While the chipmaking metals account for relatively modest levels of export, China's move reignited calls across the globe for "de-risking," or finding other countries besides China for processing and sourcing key components used in a wider range of goods such as electric vehicle batteries.

"These actions underscore the need to diversify supply chains," a U.S. Department of Commerce spokesperson said in a statement. "The United States will engage with our allies and partners to address this and to build resilience in critical supply chains."

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