China’s antimony export controls shock tungsten industry

BEIJING — China’s latest export controls have alarmed those in the critical minerals industry, with some fearing Beijing will exploit its dominance of global supply chains in unprecedented ways.

China’s Ministry of Commerce announced on Thursday Antimony Export Control It will take effect on September 15th. Use of Antimony The metal is found in bullets, nuclear weapons production and lead-acid batteries. It also makes other metals stronger.

“Three months ago, no one would have thought they would do this,” Lewis Black, chief executive of Canada’s Almonty Industries, said in a phone interview. “From that perspective, it’s pretty adversarial.” The company said it would spend at least $125 million to reopen a tungsten mine in South Korea later this year.

Tungsten is almost as hard as diamondand is used in weapons, semiconductors and industrial cutting machines. Tungsten and antimony are both on the U.S. critical minerals list and are within 10 elements of each other in the periodic table.

“My industry now thinks this is closer to reality than graphite,” Black said. China’s previous export controlsLast year, Beijing, the world’s largest graphite producer, said it would impose export licensing on the key battery material amid concerns about foreign scrutiny over its dominant position.

“I can’t explain this move, and I think it’s disturbing to a lot of people in the industry, my clients, who don’t have a plan B, and China is very aware of that. They haven’t had a plan B for 30 years,” he said.

“There’s always been a balance … they’ve never been weaponized because they could have created this snowball of escalation,” he said.

China accounts for Accounting for 48% of the world’s antimony ore production The United States will mine marketable antimony in 2023, while the U.S. Geological Survey’s latest annual report shows that the United States has not mined any marketable antimony. The report said that there has been no commercial mining of tungsten in the United States since 2015, and China dominates the global tungsten supply.

“I think this is the beginning of some rare earth and mineral export restrictions,” Tony Haddock, executive chairman of Tungsten Metals Group, said in a telephone interview. He said it was hard to believe China would directly restrict antimony.

“Based on the wording of the (China Ministry of Commerce) statement, we infer that tungsten and other rare earth elements will also be affected. But that may not happen,” said Haddock, noting that “tungsten is probably the element with the highest economic value.”

China’s Ministry of Commerce did not immediately respond to a request for comment.

The United States tried to limit China’s access to high-end semiconductors, and then Beijing announced Export Controls on Germanium and Galliumtwo metals used in chip manufacturing.

While tungsten is also used in the manufacture of semiconductors, this metal, like antimony, is used in defense production.

“Tungsten production is declining in China, but tungsten is absolutely critical in military applications, much more so than antimony,” said Christopher Ecclestone, chief mining strategist at Hallgarten & Company.

He expects China to impose export controls on tungsten by the end of this year, or even within the next month or two.

“In situations of heightened tensions where there’s competition to secure supplies of metals, and frankly we’re talking about the South China Sea or Taiwan, you want to have as much tungsten as possible,” Ecclestone said. “But you also want the other side to have as little tungsten as possible.”

The United States is already keen to reduce its reliance on Chinese tungsten.

Starting in 2026, the US REEShore Act Ban on using Chinese tungsten in military equipmentThis refers to the Restoring Onshore Rare Earth Essential Energy and Security Holdings Act of 2022.

House Select Committee on Strategic Competition between the United States and China June Announcing a new working group About U.S. critical minerals policy.

Ecclestone said that last week, the antimony trading segment noticed that the U.S. was paying several times more for antimony delivered from Rotterdam than from Shanghai. He said this was a continued rise in antimony prices after the shipping disruptions caused by the epidemic ended.

“There are suspicions that the Pentagon has been restocking certain metals, most notably antimony, because the Pentagon needs antimony for munitions,” said Ecclestone, who founded the mining strategy firm in 2003.

The U.S. Department of Defense did not immediately respond to a request for comment.

Markus Herrmann Chen, co-founder and managing director of China Macro Group, said in an email that China’s actions were more about retaliation “for what it sees as violations of its national interests.”

He noted that China’s Third Plenum in July “proposed new policy objectives for better coordination across the mineral value chain, which may reflect the increased importance of the supply of ‘strategic mineral resources’ to commercial and geo-economic interests.”

As China seeks to ensure its national security, companies in the United States and other countries are looking for emerging opportunities.

“For many years, Energy Fuels has been the largest U.S. supplier of uranium oxide to support domestic nuclear energy production,” Mark Chalmers, president and CEO of Colorado-based Energy Fuels, said in a statement. He said the company is building a U.S. rare earth product line.

“We recognise that our 40 years of expertise in naturally occurring radioactive materials gives us a competitive advantage in replicating China’s success in separating a broad range of rare earth elements from low-cost, abundant rare earth elements. Monazite” Chalmers said, referring to a mineral from which the desired metal can be extracted.

It is unclear whether China will fully implement its latest export controls.

“They don’t want to acknowledge that this could escalate,” Black said. “But I don’t think China wants this to escalate either. The last thing you want to do is create another nightmare scenario right as the U.S. election is going on. Let’s see in a week whether this is actually a policy.”