Three Years After China's Gallium and Germanium Curbs, the West Is Still Waiting for Supply

Three years after China restricted exports of gallium and germanium — two niche metals central to chipmaking, clean energy and defence — Western buyers are still absorbing the price shock and waiting for domestic production to arrive.

The curbs have pushed companies to stockpile material, hunt for alternative suppliers and redesign products around substitutes. Prices outside China now sit at roughly nine to ten times their 2023 levels, and the supply response is only beginning to take shape.

"These export controls have acted as a real wake-up call," said Cristina Belda, a senior analyst at Argus, pointing to recycling, alternative suppliers and emerging non-China projects as the main responses. Manufacturers of infrared optics used in defence and thermal imaging have been among the hardest hit by tight supply, she added.

Demand keeps climbing

While new projects are developed, the AI boom, expanding fibreoptic networks and growing use of infrared imaging are lifting consumption. Preliminary S&P Global estimates put gallium demand growth at about 12% a year through 2030, from roughly 1,000 metric tons in 2025. Global germanium demand is seen rising 3.3% annually over the same period, from an estimated 343 tons in 2025.

China's grip on supply remains overwhelming. Consultancy Project Blue estimates that in 2025 China accounted for 98.9% of primary gallium supply and 68.6% of germanium supply. Beijing introduced the controls in 2023 and later widened them to cover rare earths and other critical minerals, using its market position as leverage in trade and other disputes.

Substitution is difficult

Both metals are primarily byproducts of alumina and zinc processing, and replacing them is not straightforward. "There is no one-to-one substitute for germanium," said Jessica DeGroote Nelson, senior vice president of precision optics at US-based Edmund Optics, noting that switching materials would require redesigns. "It's not impossible, but it is very challenging."

A source at another optics company said it had halved its germanium use over the past 18 months by switching to substitutes in some applications, turning to Western suppliers and raising its own prices. "We do have many customers who are willing to purchase at current prices, the issue here is the availability of supply," the person said.

Industry participants say indium phosphide is replacing gallium arsenide in some semiconductor applications, while zinc selenide, zinc sulphide, silicon and chalcogenide glass are gaining ground as germanium alternatives in some infrared uses. All require costly technological adjustments that take time.

Stockpiling is another tactic: some buyers purchase germanium before designs are finalised to guarantee availability when production begins. Recycling is a third route. US-based Lattice Materials, which uses germanium to make crystals for displays in fighter jets, tanks and other military equipment, is pursuing it. "We don't see supply loosening up anytime in the near-term," company president Travis Wood said, adding that every data point suggests prices will hold at current highs or keep rising. Belgium's Umicore has been working with STL, a unit of Gécamines that processes mining waste in the Democratic Republic of Congo, to boost germanium recovery.

Playing catch-up

Some producers say demand is already outpacing their plans. In Greece, METLEN has begun pilot-scale production and aims to produce 50 tons of gallium annually by 2028, but says interest from potential customers already exceeds that target several times over.

In April, Australia and the US pledged more than $3.5 billion to support critical minerals projects, including gallium and germanium, nearly doubling an initial amount agreed last year. S&P Global expects ex-China gallium supply capacity to reach 20 tons by the end of 2026, leaving a gap of about 678 tons. Non-Chinese germanium metal production is seen at 31 tons, or 177 tons short of demand.

Jack Bedder, founder and director of Project Blue, said credible projects backed by governments offer a chance for greater diversification, but economies of scale still favour China, whose capacity and production costs new Western projects will struggle to match. "We think a material reduction in dependence is achievable over five years, but eliminating dependence on China is much less realistic," he said.

Government support such as price floors will probably be needed to bring new supply online and keep it commercially viable, said Piyush Goel, a consultant at London-based CRU.

By 2030, S&P Global estimates eight announced projects — including Wagerup in Australia and Clarksville in the United States — could lift ex-China gallium supply to about 386 tons from roughly 5 tons today. Even then, ex-China demand would still look to China for 65% of its supply. New germanium projects in Canada, South Korea and the United States are expected to raise ex-China refining capacity to 126 tons by 2030, but even with five ex-China refineries potentially operating, that would cover only about 48% of projected ex-China demand.

Early stages

Several announced gallium projects are still being developed and have yet to reach full commercial production, including those planned by METLEN in Greece, Alcoa and Sojitz in Australia, Rio Tinto and Indium Corporation in Canada, and Nalco in India. New entrants are adding to the effort: Korea Zinc is developing gallium and germanium capacity at home and at a planned Tennessee refinery, while US-based ReElement Technologies is developing a refining complex in Indiana.

Titan Mining, a zinc and graphite producer, expects to start germanium production in New York state by year-end at 2.5 to 3 tons, or about 7% to 10% of US demand. Among established non-Chinese suppliers, Canada's Teck Resources struck a deal with Ottawa in July to support an expansion at its facility in Trail, British Columbia.