China this week announced restrictions on germanium and gallium in retaliation for US restrictions on AI chips. That's set off fears of a tit-for-tat escalation that some fear could include lithium production, which is dominated by China.
Regarding germanium, some of the largest available reserves are owned by Russian state conglomerate Rostec and it notes that its holdings are operating at just 30% of capacity. It says it's ready to speed up production, but only to cover Russia's internal demand.
More broadly, there will surely be a bonanza in exploration and development of rare earth metals. The US already revealed a subsidy program and it will likely be expanded and accelerated.
In related news, China canceled a planned trip by the EU's Borrell scheduled for next week, without giving a reason.
"Unfortunately, we were informed by the Chinese counterparts that the envisaged dates next week are no longer possible and we must now look for alternatives," spokesperson Nabila Massrali told Reuters in a written statement on Tuesday.
US Treasury Secretary Janet Yellen is scheduled to visit Beijing on Thursday.
