China imposes temporary export ban on helium

Background: Why helium is so important

The backdrop is a strained supply situation on the global market. China is responding with the measure to the difficult supply situation resulting from the war in Iran and the resulting tensions in the Middle East. The global helium market is narrowing noticeably.

Helium is an important raw material for chip manufacturing, medical technology, and aerospace. In semiconductor production, the noble gas is used, among other things, to cool high-performance chips and to maintain cleanliness in manufacturing processes. Demand, especially for high-performance chips, has risen sharply due to the booming development of artificial intelligence.

Beijing's reasoning

He Yadong emphasized that Beijing will adjust its export controls to the development of supply and demand at home and abroad: "Je nach Veränderung von Angebot und Nachfrage im In- und Ausland passe Peking die Ausfuhrkontrolle entsprechend an". At the same time, he stated that China's actions are in line with Chinese foreign trade laws.

Unlike export controls on rare earths, the current measure is not designed, according to sources from Beijing, as a political lever against trading partners. China is not internationally counted among the significant helium exporters.

At the same time, the People's Republic is not the only country to restrict exports of the noble gas this year. Russia already introduced export restrictions on helium in April. Helium is produced as a byproduct of liquefied natural gas (LNG) production, which additionally increases the dependency on a few producing countries.

International context

The Ministry announced that it would adjust the policy in a timely manner if necessary: "Going forward, we will adjust our export-management policies in a timely manner based on changes in domestic and international helium supply and demand". In this way, the government is responding flexibly to the further development of global supply.

The analyst group Trivium China had cited the import figure in a research note this week. If the supply situation continues to worsen, the pressure on the already strained supply chains for semiconductors, medical technology, and aerospace is likely to increase.