The United States Is Repeating Its Silicon Mistake with Gallium Nitride

Key Takeaways

• China produces 99% of global primary gallium, controlling supply
• U.S. defense stockpile held zero gallium when China’s ban began
• CHIPS Act subsidies reached $7.8 B for Intel yet layoffs continued
• Only one U.S. high‑purity gallium refinery exists, dependent on imports
• Proposed DOD program would fund dual‑use advanced‑packaging fabs near defense hubs

Pulse Analysis

The gallium‑nitride shortage highlights a strategic blind spot that mirrors the United States’ earlier reliance on offshore silicon fabs. While China now supplies almost the entire primary gallium market, the U.S. has no domestic primary gallium mine and only a single high‑purity refinery that depends on imported scrap. This dependency became acute when Beijing’s December 2024 ban cut off refined gallium, exposing a critical gap in the supply chain for radar, electronic‑warfare, and emerging 5G/6G power‑amplifier markets. The situation is compounded by the sluggish rollout of the CHIPS Act, which has delivered billions in subsidies to incumbents like Intel but failed to translate into robust manufacturing capacity or job growth.

Addressing the gap requires a shift from a fabless, design‑first mindset to a full‑stack, heterogeneous‑integration approach. GaN’s superior high‑frequency, high‑voltage performance makes it indispensable for next‑generation defense systems, yet its production demands advanced wafer growth and high‑volume packaging that the United States currently lacks. A dedicated Defense Production Act‑backed program could create dual‑use advanced‑packaging facilities located near existing defense hubs—Boston’s Route 128, Huntsville, Dallas‑Fort Worth, and San Diego—leveraging both military contracts and civilian market demand to sustain operations. Direct grants, tax credits, and equity stakes in key players such as Qorvo and Wolfspeed would accelerate scale‑up while ensuring strategic control.

Securing a reliable gallium source is equally vital. Project Vault’s $12 billion investment lays the groundwork, but domestic extraction must reach at least 10‑15% of consumption by 2030 to reduce reliance on Chinese by‑products. Partnerships with allied nations, a “Trusted Gallium Road” network, and targeted funding for novel extraction technologies can diversify supply. By aligning industrial policy with national‑security imperatives, the United States can avoid a repeat of the silicon era, preserve its defense edge, and capture a growing $70 billion GaN market projected for the next decade.