US buyers bypass China’s critical mineral ban via Thailand and Mexico

According to customs and shipping records, an extraordinary flow of antimony—a metal used in batteries, chips, and flame retardants—began entering the US from Thailand and Mexico after China banned shipments to the US last year. Records obtained by Reuters indicate that at least one Chinese company is involved in this trade, revealing how US buyers of critical minerals are circumventing China’s export ban.

China dominates the supply of antimony, as well as gallium and germanium, which are crucial for telecommunications, semiconductors, and military technology. On December 3, Beijing banned the export of these minerals to the US following pressure from Washington on China’s chip sector.

Trade data suggests that US shipments are being rerouted through third countries, a situation that Chinese officials have acknowledged. This assessment was confirmed by executives from two US companies, who told Reuters they have sourced restricted minerals from China in recent months.

According to US customs data, the US imported 3,834 metric tons of antimony oxide from Thailand and Mexico between December and April. This volume is nearly greater than the total from the previous three years combined. Meanwhile, Chinese customs data shows that Thailand and Mexico have become top-three destinations for China’s antimony exports this year. Neither country ranked in the top 10 in 2023, the last full year before Beijing imposed the restrictions.

According to the consulting firm RFC Ambrian, there is only one antimony smelter across both Thailand and Mexico, with the Mexican facility having reopened in April. Neither country mines significant quantities of the metal. Despite higher prices, US imports of antimony, gallium, and germanium this year are on pace to meet or exceed pre-ban levels.

Ram Ben Tzion, co-founder and CEO of the digital shipment inspection platform Publican, stated that while there is clear evidence of transshipment, the trade data does not allow for the identification of the specific companies involved. “This is a pattern we’ve seen, and it’s consistent,” he told Reuters, adding that Chinese companies are “extremely creative in circumventing regulations.”

In May, China’s Ministry of Commerce stated that some unspecified foreign entities were “collaborating with domestic smugglers” to bypass export restrictions, declaring that halting such activities was essential for national security. The ministry did not respond to Reuters‘ questions regarding the shift in trade flows since December. The US Department of Commerce, Thailand’s Ministry of Commerce, and Mexico’s Ministry of Economy also did not respond to similar inquiries.

US law does not prohibit American buyers from purchasing antimony, gallium, or germanium of Chinese origin. Chinese firms are permitted to ship these minerals to countries other than the US if they possess the necessary licenses.

Levi Parker, CEO and founder of the US-based company Gallant Metals, told Reuters that he sources approximately 200 kg of gallium from China each month. He declined to identify the parties involved, citing potential repercussions. The process begins with purchasing agents in China who procure the materials from manufacturers. A shipping company then relabels the packages as iron, zinc, or art supplies and routes them through another Asian country.

Parker noted that these workarounds are neither perfect nor cheap. He explained that he would like to import 500 kg regularly, but larger shipments risk scrutiny, prompting Chinese logistics firms to be “very careful” due to the associated risks.