Representatives from South Korea and Japan held a video conference this week to discuss issues related to Tokyo’s export regulations on Seoul. The meeting marked three months since the last round of dialogue and the two sides had to work around mutual COVID-19 (coronavirus) travel restrictions.
The meeting was aimed at resolving Japan’s export restrictions enacted in July 2019 on three key materials of chips and display panels, as well as measures excluding South Korea from Japan’s export control whitelist, according to South Korea’s Trade Ministry.
The Ministry’s trade policy division chief Lee Ho-Yeon and his Japanese counterpart Yoichi Iida, represented the sides to discuss pending issues related to export management operation. The previous (seventh) round of policy dialogue was held in Tokyo in December 2019. At the time, the two countries agreed to hold the eighth meeting in Seoul.
Japan, however, announced a de facto quarantine measure for inbound travellers from South Korea earlier this month, citing the spread of the novel COVID-19. The following day, the Trade Ministry said the two sides had agreed to change the export management policy dialogue to a video conference format.
The South Korean government said it would urge Japan to lift export restrictions on three key semiconductor and display materials.
In July 2019, Japan removed South Korea from a list of countries that receive preferential trade treatment when importing fluorinated polyamide, photoresists and HF etching gas, meaning Japanese suppliers must apply for approval for each individual shipment they send to South Korean customers. Japan has implied that the move is related to concerns over North Korean access to chemicals such as etching gas, whilst South Korea claims that the restrictions are politically motivated.
The dispute has led South Korean consumers of HF for electronic applications to seek alternative sources, including domestic supply, although it is understood that sourcing sufficient quantities of the highest purity electronic grade material is difficult as Japan is one of the world’s most important suppliers. Exports of HF to South Korea had averaged more than 2ktpm since 2012 and had been rising but, since August 2019, no shipments of HF to South Korea have been reported at all. Roskill is monitoring HF trade in the region.
Roskill’s Fluorspar: Outlook to 2029, 14th Edition report, published in February 2020, breaks down the complex fluorine supply chain considerations and makes clear priceforecasts for the next decade based on analysis of both supply and demand.