Bismuth — a niche metal used in industries from paints to defense — has rallied spectacularly since early February, when Beijing triggered export curbs in response to US President Donald Trump’s trade offensive.

The metal was among five materials that were added to China’s list of controlled exports after Trump slapped an initial 10% import tariff on Chinese goods. Exports of bismuth from China then plunged in February, tightening the global market and sparking a near-500% surge in prices.

China dominates production of a swathe of strategic materials ensnared in the intensifying geopolitical rivalry between Washington and Beijing. On Thursday, Trump invoked emergency powers to encourage more US production of critical minerals — adding to moves by his predecessor Joe Biden.

Bismuth’s violent price action in the past seven weeks demonstrates Beijing’s ability to shake up flows of materials viewed as important for national security. China makes about 80% of the world’s refined bismuth, while the US hasn’t produced any since 2013, according to the United States Geological Survey. America gets about two-thirds of its bismuth from the Asian nation.

China’s exports of bismuth sank to 458 T in February, less than half of last year’s monthly average, according to the country’s customs administration. Benchmark global prices tracked by Fastmarkets Ltd. rocketed from $6 a pound before Beijing’s action on February 4, to almost $35 this week.

SEEKING ALTERNATIVES

A risk for President Xi Jinping over the longer term is that any effort to weaponize China’s clout in strategic commodities simply spurs more nations to find other options.

“As the major supplier of bismuth to the world, China is effectively shooting itself in the foot with export restrictions causing huge spikes in the price that may incentivize customers to look for alternative materials,” Robin Goad, chief executive officer of Fortune Minerals, which aims to mine metals including bismuth later this decade, said in an interview. “This is not good for the market over the longer term.”

Bismuth is used in everything from automotive coatings to pharmaceuticals and low-temperature alloys. It joined an expanding suite of metals on China’s list of goods subject to heightened scrutiny for export approval. Those also include tungsten, molybdenum, indium and tellurium. Prices for antimony, included in an earlier round of export controls, are 300% higher than a year ago.

There has also been a buzz around critical minerals producers on China’s stock markets in recent weeks as tensions simmer between Washington and Beijing. Zhuzhou Smelter Group Co., a producer of bismuth as a by-product of making lead and zinc, is up 24% this month, compared with a gain of less than 2% on the broader Shanghai stock market.

The only significant domestic source of bismuth in the US is from recycled alloys, which accounted for between 3% and 10% of supplies in the past five years, according to the USGS. The material can be found in some lead ores, but the last US domestic primary lead smelter was closed more than a decade ago.

China’s domestic bismuth ingots have doubled in price since the export restrictions. Traders are holding back material from the market, putting upward pressure on prices, according to Mysteel Global analyst Chen Qiqi.