Following the New Year holiday, the market is still absorbing the impact of this new policy and has adopted a cautious stance. Some market participants believe the export controls may have limited effects on bismuth and indium, but it remains to be seen how exports will unfold, sources told Fastmarkets.Unlike previous export control measures, the new policy was immediately enforced upon its announcement, leaving no transition period for the market.
Typically, such announcements allow for a grace period between the announcement and official implementation, but this time, no such leeway has been given, sources said.
China had notified relevant regions and countries before the announcement, a spokesperson for the Ministry of Commerce said.
For reference, export controls on gallium and germanium were announced on July 3, 2023, and implemented on August 1, while those on antimony were announced on August 15, 2024, and took effect on September 15. In both instances, there was a one-month gap between the announcement and implementation, providing overseas buyers with an opportunity to secure materials before the policy was enforced.
In the periods following these announcements, both Chinese and international prices for gallium, germanium, and antimony experienced significant volatility, driven by market panic and a rush to secure stocks, creating temporary supply imbalances, sources said.
However, with no such transition period granted this time, there are expectations among market participants that while domestic prices for these metals in China may remain relatively stable in the short term, international prices are likely to rise, according to sources.
“The timing of this export control is crucial, especially coming right after the US imposed a 10% tariff on Chinese imports. Previously, a transition period allowed prices to surge in the short term, as seen with antimony. Now, there’s no room for maneuver. Domestic prices should remain stable, particularly as the market is still in a cautious, post-holiday wait-and-see mode,” a Chinese exporter said.
Key metals affected by export control
China is the world’s largest producer of strategic metals such as tungsten and indium, and holds a dominant position in the upstream of global supply chains. The metals included in the new export controls are not only vital for traditional industrial upgrading but also serve as key materials for emerging technologies, including new energy, semiconductors, and artificial intelligence, according to sources.
Tellurium
The newly controlled tellurium items include tellurium metal and three tellurium compounds: cadmium telluride (CdTe), cadmium zinc telluride (CdZnTe), and cadmium mercury telluride (CdHgTe).
These materials are primarily used in solar cells, ceramics, semiconductors, and optoelectronic devices. China plays a significant role in the global market for this metal, given its position as the world’s largest producer and consumer of tellurium.
Cadmium telluride, a key material in thin-film solar cells, is predominantly used by First Solar, a major US-based manufacturer of CdTe-based photovoltaic modules.
“The control on cadmium telluride may exert some pressure on domestic prices, as a significant portion of tellurium is used in its production. If exports of cadmium telluride are hindered, the tellurium market may face more severe oversupply. However, the control is not a ban, and as with gallium and germanium last year, normal procedures should pose no significant issues,” a Chinese trader said.
In 2024, China exported about 1,215 tonnes of cadmium telluride, with a similar amount exported in 2023, marking a 75% increase from 685 tonnes in 2022, according to Chinese customs data. Malaysia, Vietnam, and India are the primary export destinations for China’s cadmium telluride.
Bismuth
Bismuth, particularly those with a purity of 99.99% or greater and silver content below one part per million, is already included in the dual-use items export control list published in December 2024. The latest round of export restrictions expands this list to include bismuth metal and its three compounds.
China is also the world’s largest producer of bismuth.
Bismuth is widely used in pharmaceuticals, semiconductors, superconductors, flame retardants, pigments, chemicals, and electronic ceramics. Bismuth germanate (BGO) crystals, for example, are core components in high-end medical CT scanners and particle detectors, while compounds like triphenyl bismuth are essential raw materials in organic synthesis catalysts.
In 2024, China exported around 1,185 tonnes of wrought bismuth (HS Code: 81061090), a 25% decrease from 1,587 tonnes in 2023. US, Germany and the Netherlands are major export destinations.
However, the largest export bismuth item, bismuth trioxide, is not affected by the new controls. This material is used in electronic ceramic powders, electrolytes, optoelectronic materials, high-temperature superconducting materials, and catalysts.
“We had inquiries from overseas customers on the first day back at work, but we did not quote. In fact, the export volume of bismuth metal is not large, and most exports are in the form of bismuth trioxide, which is not on the list. So, the impact should be limited,” a Chinese bismuth producer said.
In 2024, China’s exports of bismuth trioxide are expected to reach around 8,499 tonnes, up about 32% from 6,462 tonnes in 2023. The Netherlands, Belgium, Mexico, and Germany are the main destinations for bismuth trioxide.
Indium
Unlike tellurium and bismuth, indium metal is not subject to export control. The new policy focuses on three indium compounds instead, namely indium phosphide (InP), trimethylindium (TMI), and triethylindium (TEI).
Indium phosphide, a key second-generation semiconductor material, is widely used in optical communications and integrated circuits. With the advent of 5G technology, second-generation semiconductors like indium phosphide and gallium arsenide (GaAs) are seeing increased demand.
Due to the high technical complexity and production challenges of indium phosphide, the global market for the material is highly concentrated, with major players like Japan’s Sumitomo and U.S.-based AXT controlling nearly 80% of the market. The U.S. and Japan remain the leading producers and consumers of indium phosphide.
