Pentagon seeks supply of chip mineral gallium after China curbs exports

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The Pentagon plans to issue a first-time contract to US or Canadian companies by year-end to recover gallium, a mineral used in semiconductors and military radar systems, after China curbed exports this month.

China announced the restrictions on gallium and another mineral, germanium, in a move seen as part of the country’s tit-for-tat trade war on technology with the US and Europe. The two metals are crucial to the semiconductor, telecommunications and renewable energy industries. The curbs prompted US Treasury Secretary Janet Yellen to voice her concern during a recent visit to Beijing.

The Pentagon, which has reserves of germanium but not gallium, plans to use its authority under the Defense Production Act for “prioritizing awards” by Dec. 31, “focusing on recovery of gallium from existing waste streams of other products,” spokesman Jeff Jurgensen said in a statement. DPA funds bankroll investments in key sectors of domestic US industry for targeted national security purposes, such as the stockpiles of personal protective equipment that were used during the coronavirus pandemic.

“Recovery, not mining, is the fastest way to make the materials more available in the US,” the Pentagon said. DPA funds previously “have not been awarded for minerals recycling projects.”

Gallium and germanium are typically extracted during mining operations for other materials. But it’s expensive to process and refine them so they have often been treated as waste by western companies, while China came to dominate the supply.

Defense Department officials declined to say how much money would be placed on contract or how many companies might be tapped.

Gallium is used in Navy radar on vessels for air and missile defense and by the Army and Marines in ground-based radar for detecting rockets, artillery, mortars, cruise missiles, and manned and unmanned aerial drones. Of 47 materials for which the U.S.’s net import reliance is greater than 50%, China is either the sole or one of the leading import sources for 25, including gallium, according to a U.S. Geological Survey cited by the US-China Economic and Security Review Commission in its 2022 annual report.

The proposed projects “are similar to any effort that reprocesses mine tailings or waste streams from refinement to recover other minerals or additional amounts of the primary mineral,” the Pentagon said. “While a common practice in industry to recover a wide range of critical minerals, it has not been the subject of a DPA project to date.”

‘Reasonable strategy’

“This is a perfectly reasonable strategy,” Alexander Holderness, an analyst with the Defense Initiatives Group of the Center For Strategic and International Studies, said in an email. He co-authored a study this month on gallium after China’s announcement.

The CSIS study said gallium has “long been identified as an important component in high-energy radars, given its ability to handle high voltages at high temperatures.” So “leading-edge U.S. military radars,” including the Navy’s AN/SPY-6 and Army AN/TPS 80, rely on gallium to support their antennas and other essential components, it said.

Recyclable gallium can come from the scrap of semiconductor wafer manufacturing and from used or defective devices with gallium. Recycling takes mid-grade gallium and refines it to higher-purity grade “that’s used in cutting-edge microelectronics,” Holderness said.

Japan’s current gallium production, for example, “relies heavily on this recycling approach, and they are seen as a world leader” so “recycling serves as a credible transition strategy as the U.S. and its allies decrease reliance on Chinese gallium” and “wait to ramp up production from raw ore,” he said.

Gallium and germanium are tiny markets compared with industrial metals like copper or aluminum, but they play an indispensable role in several critical industrial sectors including semiconductors, solar cells and satellites. China is by far the largest producer, and this month’s announcement sparked a scramble to find alternative supplies.

(By Tony Capaccio, with assistance from Mark Burton)


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