Shares in this critical minerals explorer exploded after China suddenly announced an export ban on the rare minerals Gallium and Germanium, used in some advanced technology industries.
Overnight, the Chinese government announced it would regulate the export of the two critical minerals from August 1.
The move was explained with an editorial posted in the government controlled China Daily newspaper on July 3:
70 percent of germanium’s supply in the global market comes from China, while the US holds the largest germanium resources and has strict export control over it. A similar case applies to gallium of which China has the richest resources yet exports the absolute majority in the global market. Its export in 2022 had even grown by more than 40 percent than 2021. The mining of both involves heavy pollution to the environment.
All these facts make it just for the Ministry of Commerce and the General Administration of Customs to issue export restrictions on industrial products and material containing gallium and germanium from August 1, 2023.
– Source
It is a move seen as a response to the US and EU moves to secure technology exports, as the arms race for rare earth minerals and technology heats up across competing global players.
According to Bloomberg, the move was seen as an “escalation of the country’s tit-for-tat trade war on technology with the US and Europe.”
Germanium is primarily used in the semiconductor industry to make transistors, diodes, and other electronic devices. It is also used in infrared optics, fiber optics, solar cells, and as a catalyst in certain chemical reactions.
Gallium has various applications, including as a component in semiconductors, especially in light-emitting diodes (LEDs). It is also used in photovoltaic cells, lasers, thermometers, and as a coolant in certain applications, as its melting point is just above room temperature.
Investors are today scrambling to find exposure to the minerals.
Shares in MTB skyrocket on the news:
Shares in ASX listed explorer Mount Burgess Mining (ASX:MTB) surged 300% at the open on Tuesday, after China announed plans to block exports of the critical minerals Germanium and Gallium.
The ASX mino has been drilling for both minerals on a patch of land it owns rights to explore in Botswana.
MTB appears to be the only ASX-listed company with a direct connection to both rare minerals on a short investigation by this website.
According to their website, Mount Burgess Mining is “currently developing the Kihabe and Nxuu Zinc/Lead/Silver/Germanium and Vanadium deposits in Botswana.”
A 2020 presentation shows some optimism from the company on defining their Gallium and Germanium tenements in Botswana.
