Overcoming China’s gallium dominance will not be easy

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Gallium, used in smartphones, radar kit and more, punches well above its weight. Selling for money above production costs, many non-Asian producers dropped the metal in the late 1990s as China began expanding capacity. China now controls 98% of primary production of low-purity gallium, according to the US Geological Survey. Buyers from the rest of the world were left reeling when Beijing imposed export controls last year.

This triggered a near doubling of gallium prices in Europe and restricted access to a key mineral for chips with civilian and military applications.

what now Ironically, gallium is quite abundant. It is a by-product of bauxite and zinc ore. It was mined before the economy made it a broken color. Metals refiners such as Louisiana-based Atalco, which bills itself as the “last operating alumina refinery in the U.S.,” could be forced to give up gas.

Nyrstar, owned by commodities trading group Trafigura, continues to evaluate a proposed facility at its Tennessee smelter. The facility, which cost $150 million a few years ago, is believed to be able to meet 80 percent of annual U.S. demand for both gallium and germanium, another key mineral under China’s export restrictions.

Governments should probably create financial incentives, but cash exists for just that kind of purpose. Take the US Defense Production Act, Title III, which is designed to reduce dependence on foreign supply and strengthen the domestic defense industrial base.

There’s also the possibility of one-off manufacturers from outside the US returning, which include Germany, Kazakhstan and the UK. Other sources could be gathered. For example, gallium can be extracted from coal fly ash, a waste product of coal combustion.

Recycling is more difficult due to the presence of toxic arsenic in the most commonly used compound. About two-thirds of the gallium goes into gallium arsenide wafers. These, completed in epi-wafer form, are key to the components that enable 4G and 5G connections in smartphones, as well as LEDs and sensors.

But here too there are solutions. Replacing germanium makes wafers safer for the environment and, due to the availability of larger sizes, more cost-effective. True, Germanium is also subject to China’s export controls, but being more easily recycled gives it a longer life.

Growing applications, many in defence, for gallium nitride means demand is growing. Supply may tighten further, especially if, for example, China closes the loophole that allows US end users to buy from third countries such as Japan and South Korea.

Like other switches, replacing one mineral with another takes time and money. But it is clear that alternatives will have to be found.

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