This is a much more detailed report than you will find elsewhere.

Ministry of China Issues Statement on Dual-Use Commodities, translated below from original in Simplified Chinese.

Announcement No. 46 of the Ministry of Commerce in 2024 on Strengthening Export Control of Dual-Use Items to the United States.

In accordance with the relevant provisions of the Export Control Law of the People’s Republic of China and other laws and regulations, in order to safeguard national security and interests and fulfill international obligations such as non-proliferation, it is decided to strengthen export controls on dual-use items to the United States. The relevant matters are hereby announced as follows:

1. Dual-use items are prohibited from being exported to military users or for military purposes in the United States.
2. In principle, the export of dual-use items related to gallium, germanium, antimony, and superhard materials to the United States will not be permitted; for the export of dual-use items of graphite to the United States, a stricter end-user and end-use review will be implemented.

Any organization or individual in any country or region that violates the above provisions and transfers or provides relevant dual-use items originating in the People’s Republic of China to organizations and individuals in the United States will be held accountable according to law.

This announcement will be officially implemented from the date of publication.

Ministry of Commerce

December 3, 2024

What Are Superhard Materials?

Wikipedia: A superhard material is a material with a hardness value exceeding 40 gigapascals (GPa) when measured by the Vickers hardness test.They are virtually incompressible solids with high electron density and high bond covalency. As a result of their unique properties, these materials are of great interest in many industrial areas including, but not limited to, abrasives, polishing and cutting tools, disc brakes, and wear-resistant and protective coatings.

Diamond is the hardest known material to date, with a Vickers hardness in the range of 70–150 GPa. Diamond demonstrates both high thermal conductivity and electrically insulating properties, and much attention has been put into finding practical applications of this material. However, diamond has several limitations for mass industrial application, including its high cost and oxidation at temperatures above 800 °C. In addition, diamond dissolves in iron and forms iron carbides at high temperatures and therefore is inefficient in cutting ferrous materials including steel. Therefore, recent research of superhard materials has been focusing on compounds which would be thermally and chemically more stable than pure diamond.

The search for new superhard materials has generally taken two paths.[8] In the first approach, researchers emulate the short, directional covalent carbon bonds of diamond by combining light elements like boron, carbon, nitrogen, and oxygen. This approach became popular in the late 1980s with the exploration of C3N4 and B-C-N ternary compounds. The second approach towards designing superhard materials incorporates these lighter elements (B, C, N, and O), but also introduces transition metals with high valence electron densities to provide high incompressibility. In this way, metals with high bulk moduli but low hardness are coordinated with small covalent-forming atoms to produce superhard materials. Tungsten carbide is an industrially-relevant manifestation of this approach, although it is not considered superhard. Alternatively, borides combined with transition metals have become a rich area of superhard research and have led to discoveries such as ReB2, OsB2, and WB4.

Superhard materials can be generally classified into two categories: intrinsic compounds and extrinsic compounds. The intrinsic group includes diamond, cubic boron nitride (c-BN), carbon nitrides, and ternary compounds such as B-N-C, which possess an innate hardness. Conversely, extrinsic materials are those that have superhardness and other mechanical properties that are determined by their microstructure rather than composition. An example of extrinsic superhard material is nanocrystalline diamond known as aggregated diamond nanorods.

Historically, it was thought that synthetic diamond should be structurally perfect to be useful. This is because diamond was mainly preferred for its aesthetic qualities, and small flaws in structure and composition were visible by naked eye. Although this is true, the properties associated with these small changes has led to interesting new potential applications of synthetic diamond. For example, nitrogen doping can enhance mechanical strength of diamond, and heavy doping with boron (several atomic percent) makes it a superconductor.

I would take the announcement to include gallium, germanium, antimony, tungsten carbide, and diamond nanorods with an additional warning on graphite.

Where are Superhard Materials Made?

Please consider Super Hard Material Market 2024 Growth Analysis by Future Developments, Major Players and Forecast to 2032

The “Super Hard Material Market” Research Report [paywalled] serves as a comprehensive guide, providing crucial insights into industry Top players.

According to the report, Asia-Pacific accounts the biggest market share of the global total Super Hard Materials market, both for production and consumption. The production of Super Hard Materials in China took over 85% of total global output.

China Bans Rare Mineral Exports to the U.S.

The New York Times reports China Bans Rare Mineral Exports to the U.S.

China said on Tuesday that it would begin banning the export of several rare minerals to the United States, an escalation of the tech war between the world’s two biggest powers. The move comes a day after the Biden administration tightened Chinese access to advanced American technology.

The ban signals Beijing’s willingness to engage in supply chain warfare by blocking the export of important components used to make valuable products, like weaponry and semiconductors.

Sales of gallium, germanium, antimony and so-called superhard materials to the United States would be halted immediately on the grounds that they have dual military and civilian uses, China’s Ministry of Commerce said. The export of graphite would also be subject to stricter review.

China created a legal framework last year for controlling exports of gallium and germanium, which are used in semiconductors, and on Sept. 15 China added antimony, which is used in military explosives. In October, China began requiring its exporters of rare earth metals, used in everything from advanced semiconductors to smart bombs, to disclose, step by step, how the minerals would be used in Western supply chains.

China’s exports of gallium and germanium briefly halted a year ago until officials in Beijing devised a system for approving such transactions. Shipments to the United States have never fully recovered, forcing the United States to rely more on the purchase of semi-processed materials from other countries like Japan that buy directly from China.

The move by China on Tuesday echoed an unannounced embargo on exports of rare earth metals to Japan that Beijing imposed for two months in 2010 during a territorial dispute between the countries. That embargo produced considerable distress among manufacturers in Japan worried about dwindling supplies, because China provides as much as 99 percent of the world’s supply of some rare earth metals.

Even before China instituted the ban Tuesday, it had begun limiting its overall antimony exports tightly enough that global prices for the material have doubled in the past three months.

According to the United States Geological Survey, China has been supplying 54 percent of the germanium used by the United States, a material used in infrared technology and fiber optics.

The United States has not mined its own gallium, used in semiconductors, since 1987. Japan supplies 26 percent of American imports of gallium, China 21 percent and Germany 19 percent, along with several smaller suppliers.

In response to U.S. technology curbs, Chinese industry groups representing business sectors, including semiconductors and auto manufacturing, also released statements on Tuesday calling for Chinese companies to purchase more chips domestically or from countries other than the United States.

“American chip products are no longer safe and reliable, and related Chinese industries will have to be cautious in purchasing American chips,” the China Semiconductor Industry Association said.

These associations include some of the world’s largest consumers of semiconductors, so the warning could have financial implications for U.S. chip makers.

Critical Materials Risk Assessment

Our own Department of Energy has placed some of the rare earth minerals we need for weapons systems, windmills, batteries, and aircraft on a critical materials list.

Nearly all of them are mined or refined in China.

Please consider a Critical Materials Risk Assessment by the US Department of Energy

The US Department of Energy has placed some of the rare earth minerals we need for weapons systems, windmills, batteries, and aircraft on a critical materials list.

According to the analysis, there are six critical materials in the short term, which include cobalt, dysprosium, gallium, natural graphite, iridium, and neodymium. The uses for these critical materials are spread across rare earth magnets, batteries, LEDs, and hydrogen electrolyzers.

There are nine near-critical materials, which include electrical steel, fluorine, lithium, magnesium, nickel, platinum, praseodymium, silicon carbide (SiC), and uranium.

Finally, there are seven noncritical materials including aluminum, copper, manganese, phosphorous, silicon, tellurium, and titanium.

There are 12 critical, six near-critical, and four noncritical materials in the medium term.

Biden Eases Sanctions on Venezuela, Blocks Rare Earth Mining in Alaska

As an example of how stupid US policy is, please note Biden Eases Sanctions on Venezuela, Blocks Rare Earth Mining in Alaska

The Inflation Reduction Act was supposed to increase permitting in the US. As the election nears, Biden is blocking oil drilling and mining in the Alaska.

It takes years to get a mine up in production. And that is just the mining. Processing the minerals is the second stage.

China’s Ban on Rare Earths Processing Technology

On January 8, CSIS commented What China’s Ban on Rare Earths Processing Technology Exports Means

China announced a ban of rare earth extraction and separation technologies on December 21, 2023. This has significant implications for U.S. national, economic, and rare earth security. Rare earth elements—a group of 17 metals—are used in defense technologies, including missiles, lasers, vehicle-mounted systems such as tanks, and military communications. They are also used in computers, televisions, and smartphones, along with various clean energy technologies central to decarbonization.

At present China produces 60 percent of the world’s rare earths but processes nearly 90 percent, which means that it is importing rare earths from other countries and processing them. This has given China a near monopoly. Benchmark Minerals Intelligence has flagged that the United States is particularly exposed to processing restrictions for heavy rare earths, given China separates 99.9 percent of them. 

Note the above article says China bans a technology export. The setup now is blocking export of the minerals themselves.

The U.S. Army is Now Desperate for Antimony

Yahoo!Finance reports America’s Shortage of Antimony Keeps Trump Awake At Night

Antimony (Sb), a critical metalloid, is a key element of the American war machine, essential for communication equipment, night vision goggles, explosives, ammunition, nuclear weapons, submarines, warships, optics, laser sighting and more, according to U.S. Army Major General (retired) James Marks.

The U.S. Army is Now Desperate for Antimony

China produces an astonishing ~70% of the world’s rare earth minerals and controls nearly 50% of the global antimony supply.

Trade War Showdown

I have been warning about this for years

China controls more than 80% of the world’s supply of tungsten and about 90% of global magnesium production

China has an effective monopoly over processing major heavy rare earths – Dysprosium (Dy) and Terbium (Tb), and Light Rare Earths – Neodymium (Nd) and Praseodymium (Pr).  

If Trump increases tariffs on China by 60 percent, China could easily shut down rare earth exports.

It takes decades to get a mine up in the US and mining is one thing. Processing is the second. China controls about 90% of global rare earth process. No other county has the technology.

Computer Chip Sanctions Fail

On September 4, 2023, I noted US Sanctions Fail Again, China Now Produces Its Own Advanced Computer Chips

Trump and Biden both tried to cut off China’s supply of advanced microchips. The US wanted to knock Huawei out of the 5G market. Now, instead of China using US chips, it is producing its own chips.

China Bans iPhone Use for Government Officials

On September 7 2023, in response to US actions, I asked China Bans iPhone Use for Government Officials, Just a Start?

On February 18, 2024, I discussed How China Gets Around US Sanctions on Semiconductors

The US is far ahead of China on technology, but China is gaining ground faster than anyone thought.

June 4, 2024: Chip Wars, China’s Goal Is to Cut Out the US

The US is restricting China’s access to advanced microchips. The US will regret the move in one of two ways. China will become self-reliant or there will be a real war.

When Trade Ends, Wars Start

One of the Three Reasons Japan Attacked Peal Harbor was the US cut off Japan’s access to oil and natural resources. War became inevitable. Japan chose to strike first.

The US and China are in a global trade war. And the EU is on the verge of joining that trade war, egged on by the US.

However, the end game is easy to spot. Either China will be successful at advanced chip production at a pace that satisfies China, or China will move to take Taiwan by force.

China Became More Self Reliant

Actions by Biden forced China to become self-reliant on making chips. The US was shocked at how fast that happened.

Chinese chips are not good enough for AI, but they are good enough for 5-G phones, autos, and most devices.

Meanwhile, Biden blocked mines in the US.

Where is This Headed?

The short answer is wherever Trump takes it.

Currently, the US gets around China’s exports restriction by buying rare earths and superhard materials from Japan or Germany. However, the original source is China.

If Trump escalates the trade war big enough, then China could and would shut off all rare earth and superhard exports to every nation.

Thus, Trump’s 50 percent tariff threats on China will do one of two things, perhaps both: Block all rare earth exports from China or start WWIII.

Good luck with that.

Oh, I forgot to add: Trade wars are good and easy to win.

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