Nikkei Exclusive: Beijing Delays Key Material Exports to Taiwan! Chinese Customs Inspections 'Take Their Time,' Leaving Taiwan's High-Tech Industry in Supply Chain Crisis

Nikkei Asia reported exclusively on the 20th that China is delaying exports of critical aerospace and optical materials to Taiwan, a move that has already severely impacted the supply chains and delivery schedules of Taiwan's high-tech industries.

Multiple insiders told Nikkei Asia that since last year, Chinese customs inspections have significantly lengthened, causing obstacles and delays for some optical technology manufacturers trying to procure raw materials from Chinese suppliers. A senior executive in the optical industry, who requested anonymity due to fears of retaliation, bluntly stated: "This is a challenge facing the entire industry. Many companies are encountering the same problem, which has greatly extended product delivery times." The executive noted that materials containing "germanium" and "quartz" are currently being obstructed when passing through Chinese customs.

Germanium is a core material for thermal imaging and infrared lenses, and a key component in fiber-optic communications and optical technologies, widely used in defense and various industrial fields. Quartz is an essential material for optical components and semiconductor manufacturing. China is the world's largest supplier of these materials and has repeatedly used export controls on raw materials as leverage during geopolitical disputes.

Insiders further revealed: "We’ve learned that some Chinese suppliers have been summoned by authorities and questioned about their customer lists and shipment details. We’ve already lost some orders because repeated delays in raw material deliveries mean we simply cannot deliver to customers on time." A senior official at a chip equipment manufacturer told Nikkei that due to China’s restrictions on quartz exports impacting production capacity, delivery times have been forced to extend by several months. "The semiconductor industry demands extremely high quality and precision in quartz, but currently, we have no alternative sourcing options outside of China."

In addition to the optics and semiconductor sectors, the aerospace industry also faces supply chain disruptions. Insiders indicated that supplies of permanent magnets from China have become a critical bottleneck, particularly "neodymium permanent magnets" used in manufacturing precision motors and advanced robots. An aerospace supplier executive admitted to Nikkei: "We’ve found that the key permanent magnets necessary for motor production are experiencing supply interruptions due to China’s export controls, and it’s very difficult to find cost-effective alternatives elsewhere."

Beijing has repeatedly used export controls on critical materials and metals to pressure trading partners in recent years, prompting the U.S., Japan, and Europe to accelerate efforts toward "de-risking" and reducing dependence on Chinese raw materials. In December 2024, China updated its strictly controlled list of "dual-use items," formally adding quartz materials due to their combined defense and civilian value. Prior to this, Beijing had temporarily banned exports of germanium and gallium to the United States in retaliation for the Biden administration’s technology restrictions on China’s semiconductor industry.

Nikkei notes that in response to the threat of supply disruptions, Taiwan’s Ministry of Economic Affairs is fully supporting the Industrial Technology Research Institute (ITRI) in developing domestic rare earth refining and separation technologies. The goal is to complete a pilot production line within three years, comprehensively strengthening Taiwan’s autonomy and resilience in critical raw materials. However, China’s General Administration of Customs did not respond to Nikkei’s request for comment on the exclusive report.