Seoul races to secure essential minerals, but continuing trend of Chinese export restrictions exposes vulnerabilities
The South Korean Ministry of Economy and Finance (MOEF) met on Dec. 22 to address supply chain risks involving urea, graphite, gallium and germanium. This meeting reviewed current global market trends and discussed South Korea’s response plans. The focus was primarily on mitigating risks and ensuring a stable supply chain for these materials.
As of Dec. 21, South Korea has secured a 6.6-month stockpile of urea due in part to the efforts of private companies in securing alternative sources. Additionally, the South Korean government has taken steps to facilitate consumer access to urea by updating and verifying information on Opinet, a website operated by the Korea National Oil Corporation that provides oil price information nationwide.
Why It Matters
MOEF’s Friday meeting comes amid China’s export restrictions on critical minerals, including urea, graphite, gallium and germanium. These materials are vital for various industries, with urea essential for reducing nitrogen oxide emissions and fertilizer production, graphite for battery production and gallium and germanium for semiconductor manufacturing. China’s export restrictions further exacerbate South Korea’s supply chain vulnerabilities, particularly as the U.S.-China rivalry intensifies.
Although South Korea has proactively secured a 6.6-month urea stockpile, with private companies playing a key role in sourcing alternatives, this achievement is shadowed by China’s announcement last week of its ban on exporting technology for rare earth magnets. As Chinese export controls continue to trend, South Korean supply chains face increased vulnerability. Seoul’s acute awareness of the need to strengthen its supply chain was voiced by the Federation of Korean Industries’ proposal last Wednesday for a “trilateral economic alliance” between U.S., South Korea and Japan, emphasizing cooperation in supply chains and advanced industries. Despite significant strides in the past year to improve their joint security partnership, the feasibility of such a trilateral economic alliance is made doubtful by U.S. President Joe Biden’s faltering poll numbers against Donald Trump and Japanese Prime Minister Fumio Kishida’s low approval ratings.
The South Korean Ministry of Economy and Finance (MOEF) met on Dec. 22 to address supply chain risks involving urea, graphite, gallium and germanium. This meeting reviewed current global market trends and discussed South Korea’s response plans. The focus was primarily on mitigating risks and ensuring a stable supply chain for these materials.
As of Dec. 21, South Korea has secured a 6.6-month stockpile of urea due in part to the efforts of private companies in securing alternative sources. Additionally, the South Korean government has taken steps to facilitate consumer access to urea by updating and verifying information on Opinet, a website operated by the Korea National Oil Corporation that provides oil price information nationwide.
Get 30 days
of free access to
KoreaPro
Full access to all analysis
The KOREA PRO newsletter, every business day
Daily analysis on the top story of the day
The ability to suggest topics for coverage by our specialist team
Be smart about South Korea
Get full access to expert analysis and opinion.
Start now
No charges during your trial. Cancel anytime. A paid subscription will start after 30 days.