China restricts export of crucial raw materials

[anonymous-user]

Can see the EU getting squeezed as this power play between US and China plays out

https://edition.cnn.com/2023/07/03/business/german...

[Oliver Hardy]

86 said:

Can see the EU getting squeezed as this power play between US and China plays out

https://edition.cnn.com/2023/07/03/business/german...

Someone explain please, had a quick search and gallium (never heard of it till now) is a by product of producing aluminium, so why is USA/Europe so dependent on China for it?

[b0rk]

China have cornered the market in low grade production. It’s an element so Alu production doesn’t create it but it can be present in low quantities in Bauxite. Chinese Bauxite contains a higher quantity of gallium so a higher yield is possible.

[Ian Geary]

Oliver Hardy said:

Someone explain please, had a quick search and gallium (never heard of it till now) is a by product of producing aluminium, so why is USA/Europe so dependent on China for it?

I'm not an expert, but I'm sure price was the deciding factor.

A UK made low value added product like this simply can't compete with a China made product. Like for like, china will have economies of scale, plus far lower employee, energy and regulatory costs.

There is a short term gain to the west for this, bit obviously building up a medium/ long term problem of relying on a country you can't be certain of.

People are often unwilling to pay to avoid medium/long term problems. See cheap russian energy for an example.

When I say people, I mean consumers / taxpayers / voters.



That being said, personally: if the USA is restricting trade to China, I can't get too upset with the Chinese for restricting it back.

China as a political power "seems" more able to put long term gains over short term costs, but how would we really know?

[pquinn]

Oliver Hardy said:

Someone explain please, had a quick search and gallium (never heard of it till now) is a by product of producing aluminium, so why is USA/Europe so dependent on China for it?

Isn't this the same as happened with all the rare earths - the Chinese moved in, undercut everyone else to the point that they shut down production, and having obtained a (near?) monopoly they then leverage that to push up prices or just cut off supplies.

It's not exactly a sophisticated or sneaky play but it seems to have worked.