The price of gallium has more than doubled since China restricted exports of the metal last summer. The export controls, first announced in July 2023, were to “safeguard national security and national interests.” Demand for gallium has not fallen, as gallium is of strategic importance to the semiconductor industry.
An article from the Radio France Internationale (RFI) “Raw Materials” column notes that China’s decision to restrict gallium exports had immediate consequences. Chinese gallium exports nearly halted in August and September of 2023 before resuming at much lower volumes. In the first two months of 2024, China’s gallium exports were just over 2,700 kg, compared to over 8,800 kg in the same period during the previous year.
The supply disruptions have caused prices to skyrocket, doubling in just 8 months. In late March of 2024, gallium prices reached $575/kg in Rotterdam. Prices have spiked due to concerns over shortages and the need to replenish depleted inventories. Demand remains strong; there are no substitutes for gallium in many high-tech applications.
Currently, gallium supply remains heavily dependent on China. An IFRI (Institut Français des Relations Internationales) researcher noted that, while current prices make gallium production and refining more profitable, this may not fundamentally reshape the industry as the price surge is unlikely to be permanent.
Recognizing the strategic importance of gallium, a French working group has begun exploring Europe-based solutions. While Europe ceased primary gallium production in 2016, the BRGM analysis suggests that Europe still has the technical capabilities to address the current shortage.
Source: Radio France International, April 12, 2024
https://rfi.my/AVnv