China’s antimony export restrictions shake up tungsten industry

BEIJING — China’s latest export restrictions have unsettled players in the critical minerals industry, with some worried Beijing will leverage its dominance of global supply chains in unprecedented ways.

China’s Commerce Ministry said Thursday it would impose export controls on antimony starting Sept. 15. Antimony is used in bullets, nuclear weapons manufacturing and lead-acid batteries, and can also strengthen other metals.

“Three months ago, [any] “Everybody assumed they would do that. It’s been pretty confrontational in that respect,” Lewis Black, CEO of Canada-based Almonte Industries Ltd., said in a phone interview. The company has said it will spend at least $125 million to reopen a tungsten mine in South Korea later this year.

Tungsten is nearly as hard as diamond and is used in weapons, semiconductors and industrial cutting machines. Both tungsten and antimony are on the US list of critical minerals and are within 10 elements of each other on the periodic table.

“In my industry, we see this becoming a lot more accessible than graphite,” Black said, referring to China’s previous export restrictions. Beijing, the world’s largest graphite producer, said last year it would enforce export licenses for the key battery material after coming under scrutiny from foreign countries concerned about Chinese dominance.

“This move is inexplicable. I think it has upset a lot of people in the industry, my clients. They have no Plan B and China knows that very well. For 30 years, they have had no Plan B,” he said.

“It was always balanced. They were never weaponized because that could snowball and cause escalation,” he said.

China accounted for 48% of global antimony mine production in 2023, while the United States mined no marketable antimony, according to the U.S. Geological Survey’s latest annual report. The U.S. hasn’t commercially mined tungsten since 2015, and China accounts for the majority of the world’s tungsten supply, the report said.

“I think this is the beginning of export restrictions on some rare earth elements and minerals,” Tony Adock, chairman of Tungsten Metals Group Inc., said in a phone interview. He said he found it hard to believe China would restrict just antimony.

” [Chinese Commerce Ministry] “After the statement was written, we applied it to tungsten and other rare earth elements. That may not happen,” Adock said, noting that “tungsten is probably the most important economically.”

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

The United States has sought to restrict China’s access to advanced semiconductors, leading Beijing to announce export controls on germanium and gallium, two metals used in semiconductor manufacturing.

Tungsten is also used in semiconductor manufacturing and, like antimony, is also used in the defense industry.

“Although China’s tungsten production is declining, tungsten is far more essential than antimony for military applications,” said Christopher Eccleston, principal and mining strategist at Hallgarten & Co.

He expects China to implement tungsten export controls by the end of the year, if not within the next month or two.

“Frankly, in a situation where there’s a race to secure metal for potential tensions like the South China Sea or Taiwan, you want to secure as much tungsten as possible,” Ecclestone said, “but you also want as little tungsten as possible in the hands of the other side.”

The United States is already eager to reduce its reliance on China for tungsten.

Starting in 2026, the US REEShore Act will ban the use of Chinese tungsten in military equipment. This refers to the Rare Earth Elements Onshore Critical Energy and Security Reserves Recovery Act of 2022.

The House Select Committee on U.S.-Communist China Strategic Competition announced in June the creation of a new working group on U.S. critical minerals policy.

Mr Ecclestone said last week that he had noticed that the niche market for antimony trading had seen U.S. buying prices from Rotterdam become significantly higher than the price of deliveries from Shanghai. He said antimony prices continued to rise even after the pandemic-related shipping disruptions ended.

“We suspect the Ministry of Defence is replenishing its stockpiles of certain metals, particularly antimony, because it is needed for munitions,” said Mr Ecclestone, who set up the Mining Strategies Company in 2003.

The Pentagon did not immediately respond to a request for comment.

Markus-Hermann Chen, co-founder and managing director of China Macro Group, said in an email that China is stepping up retaliatory actions “against what it perceives as infringements on its national interests.”

He noted that the third plenary meeting of Chinese policymakers in July “put forward an entirely new policy objective of improving coordination across the mineral value chain, perhaps reflecting the increased importance of the supply of ‘strategic mineral resources’ to both business and geopolitical interests.”

As China seeks to ensure its national security, companies in the United States and elsewhere are seizing new opportunities.

“Energy Fuels has been the largest U.S. supplier of uranium oxide for several years to support domestic nuclear power generation,” Mark Chalmers, president and CEO of Colorado-based Energy Fuels, said in a statement. The company is building out a rare earth product line for the U.S., he said.

“We recognized that our 40 years of expertise working with natural radioactive materials gives us a competitive advantage in replicating China’s success in separating multiple radioactive materials. [rare earth elements] “From monazite, which is cheap and abundant,” Chalmers said, referring to a mineral from which the needed metals can be extracted.

It remains 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 they want to do is create another boogeyman.” [at] The US elections are starting. We’ll know in a week if this is really the policy.”