By Li Panpan

(JW Insights) Jul 5 -- US wafer maker AXT said it would seek permission to continue exporting gallium and germanium substrate products from China after the country imposed export controls on these two critical metals for chip manufacturing.

AXT, which has manufacturing facilities in China, said its subsidiary in Beijing, Tongmei Xtal Technology, would immediately start applying for a license. “We are actively pursuing the necessary permits and are working to minimize any potential disruption to our customers,” said Morris Young, chief executive officer of the California-based company, according to a Reuters report on July 3.

Beijing Tongmei Xtal Technology, AXT’s main China unit, makes high-performance compound and single-element semiconductor substrate wafers comprising indium phosphide, gallium arsenide, and germanium, said a Yicai Global report.

In the first quarter of this year, AXT’s gallium arsenide and germanium substrates exported from China contributed about $4.3 million in revenue, mainly for consumer, automotive, display, and industrial applications.

China is the top source of both metals, accounting for 94% of gallium supply and 83% of germanium, according to a European Union study on critical raw materials this year. The two metals have a vast array of specialist uses across chipmaking, communications equipment, and defense, said a Bloomberg report on July 4.

Jefferies analysts said China controls around 80% of the world's gallium and germanium output, and they saw the export controls as China’s second, bigger countermeasure after the Micron ban, reported a Bloomberg report on July 4.