Chinese semiconductor industry

mst said:

But as with the rare earths, China dominates here mainly because of its cost advantage. If supplies from China were cut off, gallium production in other countries would quickly pay off again.

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That's a typical white boy copium, in reality:

1) Building mines takes time and it would have to be fully subsidized because it is not economically feasible. Moreover, every single product made from non-Chinese gallium\germanium would have to be subsidized to be cost-competitive against products made from Chinese rare earths, otherwise all that effort is going to be useless.

2) China dominates rare earths refining even more than mining - both in terms of capacity and the necessary equipment. Simply building refineries is going to take years, building it without Chinese equipment? Decades, if ever, considering the "Western speed" where they spend several years on boasting and puffing their chests before even starting to do any work.

xypher said:

That's a typical white boy copium

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Stop racializing things at every opportunity. We're talking about the geopolitics of rare earth refining here.

Beijing jabs in US-China tech fight with chip material export curbs​

• China puts export controls on gallium, germanium products
• Move seen as retaliatory measure in US-China chip spat -analysts
• Firms rush to apply for permits, stockpile
• Concerns rise that curbs on rare earth exports could be next
• Measure announced just before Yellen visit to Beijing

mst said:

But as with the rare earths, China dominates here mainly because of its cost advantage. If supplies from China were cut off, gallium production in other countries would quickly pay off again.

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Cost is the go to copium of the west. "We can extract and refine critical minerals too, it's just not cost effective." Unlike the western copium addicts, Chinese people are much more practical and don't make similar retarded claims like "We can use E-Beam lithography to make sub 10nm chips too, it's just not cost effective."

Cost is the probably the largest factor in the commercialization of technologies. Literally almost all questions of why do we do/use X instead of Y can be boiled down to cost efficiency.

mst said:

If supplies from China were cut off, gallium production in other countries would quickly pay off again.

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The ban is not outright. It is extremely surgical, aimed at suppliers of the US Military. China can simply approve export licenses for everyone else.



This way China keeps its market share while US is forced to sink exorbitant amounts of money into creating a separate supply chain just for military use. This separate supply chain won't experience economies of scale because all other US entities will continue buying cheaper Chinese gallium. From a cost perspective, we're essentially forcing them to allocate resources and investments in a horrifically inefficient manner lol.

While the US military will wean itself off Chinese gallium in the long run, it's going to come at a heavy financial cost. Chinese gallium makers will continue dominating US and international markets because nobody can compete with them on price. Sanctions are a double edged sword, but the damage here is far from equal - this is a win for China, short, medium and long term.

tl;dr if you think US defence spending bloat is bad, wait until China starts weaponizing its rare earths monopoly. I highly suspect that this may be the first of many such sanctions.

Boltzmann said:

Stop racializing things at every opportunity. We're talking about the geopolitics of rare earth refining here.

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Stop crying, it's a fact - all those talking points are produced by coping white Westerners and yes, a huge part of why Westerners are ganging up on China even if they hurt themselves in the process is racial. It's not like they hide it anyway, ask EU's chief gardener. Same shit happened to Japan before they got neutered by Plaza Accord, did you see American senators smashing German cars, electronics, etc. or Americans killing white people because they were angry that "German companies put them out of work" (e.g. Vincent Chin, the judge gave them no jail time and a measly fine because they "weren't the kind of men you send to jail") despite the fact that German companies were similarly outcompeting American companies? No, only Japanese items and companies were subjected to that treatment. Did you see Western "free" media spam white peril propaganda about Germany at that time like they did with Japan? No, of course not. Only in a fantasy la-la-la land do we live in a post-racial society, so yeah, racial lens is very important. A lot of this faulty logic has a racial basis where white people strongly believe that Asians like Chinese are incapable of innovation or quality and can only compete in terms of cost (cheap labor, lack of regulations, etc.) using Western tools, leading them to think that they can destroy China with minimal costs and the only end result is going to be a slight increase in prices.

As a matter of fact, my previous comment is fully on topic and explains why the user's talking points are incorrect while yours is a complete off-topic because you got offended.

56860 said:

The ban is not outright. It is extremely surgical, aimed at suppliers of the US Military. China can simply approve export licenses for everyone else.

View attachment 115401

This way China keeps its market share while US is forced to sink exorbitant amounts of money into creating a separate supply chain just for military use. This separate supply chain won't experience economies of scale because all other US entities will continue buying cheaper Chinese gallium. From a cost perspective, we're essentially forcing them to allocate resources and investments in a horrifically inefficient manner lol.

While the US military will wean itself off Chinese gallium in the long run, it's going to come at a heavy financial cost. Chinese gallium makers will continue dominating US and international markets because nobody can compete with them on price. Sanctions are a double edged sword, but the damage here is far from equal - this is a win for China, short, medium and long term.

tl;dr if you think US defence spending bloat is bad, wait until China starts weaponizing its rare earths monopoly. I highly suspect that this may be the first of many such sanctions.

Click to expand...

This is a good strategy, the main issue there would be to enhance controls over supply chains - if China finds one of the purchasers violating this agreement, then they should be banned to make an example and show that China is deathly serious about their export controls. I think it is only the beginning - they will test this out on Gallium/Germanium, then start expanding both the export restrictions and the blacklisted companies as a response to American sanctions. In particular, I think there's a possible escalation in the form of fully banning Micron products from the Chinese market because as @tokenanalyst , firms began asking suppliers to certify their products as "Micron free" to be eligible.

xypher said:

This is a good strategy, the main issue there would be to enhance controls over supply chains - if China finds one of the purchasers violating this agreement, then they should be banned to make an example and show that China is deathly serious about their export controls. I think it is only the beginning - they will test this out on Gallium/Germanium, then start expanding both the export restrictions and the blacklisted companies as a response to American sanctions. In particular, I think there's a possible escalation in the form of fully banning Micron products from the Chinese market because as @tokenanalyst

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, firms began asking suppliers to certify their products as "Micron free" to be eligible.

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Someone's already done the analysis today and found there are 8 more such items that China is dominate in that would be suitable for weaponizing. Still plenty of cards to play.

CMP said:

Can you explain what you mean by the former?

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For example, the US gov is super strict about everything in the F35 being US made, except they have to always give a waiver for samarium and samarium magnets

56860 said:

The ban is not outright. It is extremely surgical, aimed at suppliers of the US Military. China can simply approve export licenses for everyone else.

View attachment 115401

This way China keeps its market share while US is forced to sink exorbitant amounts of money into creating a separate supply chain just for military use. This separate supply chain won't experience economies of scale because all other US entities will continue buying cheaper Chinese gallium. From a cost perspective, we're essentially forcing them to allocate resources and investments in a horrifically inefficient manner lol.

While the US military will wean itself off Chinese gallium in the long run, it's going to come at a heavy financial cost. Chinese gallium makers will continue dominating US and international markets because nobody can compete with them on price. Sanctions are a double edged sword, but the damage here is far from equal - this is a win for China, short, medium and long term.

tl;dr if you think US defence spending bloat is bad, wait until China starts weaponizing its rare earths monopoly. I highly suspect that this may be the first of many such sanctions.

Click to expand...

I think it is more cost and time effective for the US to make thousands of shell companies to purchase critical minerals from China than for US to build up their domestic critical mineral supply chain just for the US military.

xypher said:

This is a good strategy, the main issue there would be to enhance controls over supply chains - if China finds one of the purchasers violating this agreement, then they should be banned to make an example and show that China is deathly serious about their export controls. I think it is only the beginning - they will test this out on Gallium/Germanium, then start expanding both the export restrictions and the blacklisted companies as a response to American sanctions. In particular, I think there's a possible escalation in the form of fully banning Micron products from the Chinese market because as @tokenanalyst

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, firms already started asking suppliers to certify products as "Micron free".

Click to expand...

coolgod said:

I think it is more cost and time effective for the US to make thousands of shell companies to purchase critical minerals from China than for US to build up their domestic critical mineral supply chain just for the US military.

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This basically comes down to how well Chinese authorities can enforce and oversee sanctions. No doubt US will try to set up some shell companies to get around the ban, even if it is a massive blow to their pride. But if companies feel there is a high risk of getting caught, they are less likely to try.