Energy transition at risk? China shock for Germany

China plans to restrict exports of the metals gallium and germanium, which are essential for the energy transition and digitization. The metals are needed in solar cells, computer chips and infrared lenses. The measure is seen as a Chinese reaction to restrictions on the export of important chip technologies.

Energy transition shock: China restricts metal exports

The Chinese government has announced that Restrict export of gallium and germanium. From August 1, licenses will be required to export the metals, which amounts to export controls. The measure is a direct reaction to the USA, which has pushed the Dutch lithography world market leader ASML to only sell older systems to China.

Germany and Europe are dependent on China for supplies of gallium and germanium. germanium becomes for solar cells, but also for infrared lenses and computer chips needed. Gallium, in turn, is indispensable for the construction of smartphones, satellites and radars, among other things. Obtaining the metals is likely to become more expensive and slower in the near future. Effects on the prices of solar modules are possible.

China is responsible for more than half of the germanium available on the world market, with gallium it is even around 80 percent. Other countries also produce the metals, but the production is usually much more expensive there. Germanium is obtained as a by-product of zinc, gallium is mainly produced in the production of aluminum (source: hot online).

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Without China: Other countries could step in

Although China dominates the market and offers the cheapest products, gallium and germanium are also produced in other countries. Belgium, South Korea and Japan, but the USA also produces the metals. Other major manufacturers are Russia and Ukraine.

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