China just stopped exporting two minerals the world's chipmakers need

Editor's Note: Sign up for CNN's Meanwhile in China newsletter which explores what you need to know about the country's rise and how it impacts the world.

China's exports of two rare minerals essential for manufacturing semiconductors fell to zero in August, a month after Beijing imposed curbs on sales overseas, citing national security.

China produces about 80% of the world's gallium and about 60% of germanium, according to the Critical Raw Materials Alliance, but it didn't sell any of the elements on international markets last month, Chinese customs data released on Wednesday showed. In July, the country exported 5.15 metric tons of forged gallium products and 8.1 metric tons of forged germanium products.

When asked about the lack of exports last month, He Yadong, a spokesperson from China's commerce ministry told a press briefing Thursday that the department had received applications from companies to export the two materials. Some applications had been approved, he said, without elaborating.

The curbs are indicative of China's apparent willingness to retaliate against US export controls, despite concerns about economic growth, as a tech war simmers.

The world's second largest economy is already grappling with weak domestic demand and a housing crisis. Last month, the country's exports suffered their biggest drop in more than three years, dealing a new blow to its faltering recovery.

Analysts say restricting exports is a "double-edged sword" that may hurt the Chinese economy and accelerate the shift of supply chains out of the country.

China may be the industry leader in producing the two elements, but there are alternative producers, as well as available substitutes for both materials, Eurasia Group analysts said in a July research report.

The impact of the collapse in exports is already being felt at home. Prices for gallium have fallen in China, as export controls caused inventories to pile up.

On Thursday, the spot price of gallium stood at 1,900 yuan ($260) per metric ton, down nearly 20% from early July, according to information from the Shanghai Metal Market.

The spot price of germanium, meanwhile, has increased slightly because of tight supply, reaching 10,050 yuan ($1,376) per metric ton on Thursday.

In July, Beijing said the two elements, which are used in a variety of products including computer chips and solar panels, would be subject to export controls to protect the country's "national security and interests."

Starting August 1, exporters would need to apply for special permission to ship them out of the country.

The move has ramped up a tech war with the United States over who has access to advanced chipmaking technology, which is vital for everything from smartphones and self-driving cars to weapons manufacturing.

Last October, the Biden administration unveiled a set of export controls banning Chinese companies from buying advanced chips and chip-making equipment without a license.

But for Washington's campaign to be successful, other countries had to participate. Japan and the Netherlands joined in the effort earlier this year, which further curbed chipmaking exports to China.

Beijing hit back by launching a cybersecurity probe into US chipmaker Micron in April before banning it from selling to Chinese companies working on key infrastructure projects.

More chip curbs from Washington may be coming after Huawei introduced the Mate 60 Pro smartphone last month, sending shockwaves through the tech world.

The model is powered by an advanced chip, which was created despite US sanctions intended to cut the Chinese tech giant off from such technology.

The release of the Mate 60 Pro has "created political pressure" for the United States to escalate sanctions on Huawei and Semiconductor Manufacturing International Corp. (SMIC), the Chinese chipmaker believed to have made the semiconductor, Jefferies analysts wrote in a Monday research note.

"We expect Biden to focus on tightening the [chips] ban against China in the fourth quarter," they added.