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Through the Gateway: Germanium – Semiconductor of the Future?

Our first Zinc co-product, Germanium, is a silvery metalloid.  According to USGS“in nature, it never exists as the native metal in nature” and “is rarely found in commercial quantities in the few minerals in which it is an essential component.” That said, the “most commercially important germanium-bearing ore deposits are zinc or lead-zinc deposits formed at low temperature.”

Discovered in 1886, it was initially considered a “weakly conducting metal without much use”, but Germanium has been an important factor in semiconductor technology since the development of the world’s first transistor in 1947 – the purified Germanium semiconductor.   Today, its main uses worldwide, according to USGS, are estimated to be fiber optics, infrared optics, polymerization catalysts, electronics and solar applications.   There has been some fluctuation in domestic consumption – consumption for fiber optics for space-based uses increased while infrared optics use declined — but that decline was partially offset by growth in commercial and personal markets.

In the semiconducting sector, Germanium was superseded by Silicon as the material of choice, but, according to Purdue University researchers, that may soon change. Silicon’s properties limit the ability to make smaller transistors and more compact integrated circuits, making Germanium all the more attractive for future advances in this field.

While there is some domestic Germanium production, most of it comes from “either the processing of imported Germanium compounds or the recycling of domestic industry-generated scrap,” while Germanium recovered from zinc concentrates at two domestic mines is exported for processing. All told, the U.S. is 85% import dependent for its domestic Germanium needs.

Meanwhile, it might be worth taking a look at the British Geological Society’s latest Risk List – an assessment of “current supply risk for elements or element groups which are of economic value” – which assigns Germanium the fourth highest risk score on its “relative supply risk index.”  The main factor here is one that ARPN followers will find familiar: nine of the top ten metals in BGS’s risk list count China as the world’s primary producer.

Christopher Ecclestone, discussing the issue for InvestorIntel, raises a good point:

“The Chinese don’t dominate Gallium, Germanium and Antimony because they are the only country that has these metals. It is only because of a conscious policy on the part of the Chinese government and an unconscious acquiescence on the part of West that has allowed this situation to evolve. A goal for 2020 (dare we call it a Five Year Plan) should be to break the Chinese dominance in the top ten metals on this BGS list.” 

Once again, the path to co-product access leads “Through the Gateway” – in this case, most often Zinc. And in spite of having significant known resources of Zinc, the U.S. is 82% import-dependent on this gateway metal.