Korea Zinc Co. struck a supply agreement with Lockheed Martin Corp. to provide germanium sourced outside China, as U.S. defense contractors scramble to secure alternatives following Beijing’s export ban on critical minerals.
The South Korean metals producer announced plans to invest ₩140 billion ($100.76 million) in a new germanium facility at its Onsan Smelter in Ulsan, with production targeted for the first half of 2028 following test operations in 2027. The timeline suggests immediate relief for supply shortages remains elusive.
China banned exports of germanium, gallium, and antimony to the U.S. in December, escalating trade tensions after Washington imposed fresh semiconductor restrictions on Chinese companies. Beijing controls roughly 68% of global refined germanium production, according to Korean trade agency KOTRA.
The metal proves essential for defense applications including thermal imaging systems, infrared sensors, and night vision equipment that Lockheed Martin incorporates into military hardware. Germanium compounds are critical components in the F-35 fighter jet’s radar system, with China’s export curbs already causing supply chain disruptions for the $1.7 trillion program.
Under the memorandum signed Aug. 25, Korea Zinc commits to sourcing materials from countries excluding China, North Korea, Iran, and Russia. The arrangement grants Lockheed Martin priority purchasing rights, though both companies must still negotiate detailed terms for a long-term contract.
The facility aims to produce high-purity germanium dioxide equivalent to approximately 10 tons of germanium metal annually — a modest output compared to global demand. U.S. geological surveys estimate China’s export restrictions could reduce American GDP by up to $8.2 billion if gallium supplies were completely severed.
Korea Zinc’s diversification extends beyond germanium. The company shipped 20 tons of antimony to Baltimore in June, targeting annual exports exceeding 240 tons by next year.
