(NewsNation) — China’s fight with the United States over high-tech trade intensified after the former country announced it will impose restrictions on exporting gallium and germanium.

Starting Aug. 1, exports from China will require “official permission” from the government, according to the Associated Press. China’s Commerce Ministry says controls on gallium and germanium are intended to “safeguard national security.”

This comes as U.S. Treasury Secretary Janet Yellen is due to arrive in Beijing Thursday as part of efforts by the Biden administration to revive relations between the two countries.

What are gallium and germanium, and why are they important?

China is the world’s biggest source of gallium and germanium, Reuters reported. According to the Critical Raw Materials Alliance, about 60% of the world’s germanium, and about 80% of its gallium, is produced in China.

The materials are crucial in making semiconductor chips, as well as electronics used in the defense and renewable energy sectors.

Semiconductor chips are used in items people use every day, from smartphones to cars to critical infrastructure.

“They are also essential building blocks of the technologies that will shape our future, including artificial intelligence, biotechnology, and clean energy,” the National Institute of Standards and Technology wrote.

Reuters wrote that fiber optic cables, plastics and infrared radiation are made with germanium. Germanium can be found in military devices like night-vision goggle and satellite imagery sensors.

Gallium can be replaced by silicon or indium in some cases, Reuters writes. Silicon can also be a less-expensive substitute for gemanium in some electronic applications, but experts say there is another cost: performance.

Semiconductor wafers made with gallium arsenide can operate at higher frequencies and are heat resistant, Reuters writes, which is why they are preferred to silicon. Silicon devices also make more noises than ones made with gallium, especially at high operating frequencies. This makes gallium useful in radars and radio communication devices.

What will happen when restrictions start?

Neither the U.S. nor Europe imports huge amounts the materials, CNBC said. The publication wrote that the U.S. received $5 million in gallium metal, and $220 million of gallium arsenide in 2022. Meanwhile, America’s germanium intake was $60 million.

Semiconductor companies downplayed the effects of China curbing its exports of gallium and gemanium, Barron’s said.

One of them, Navitas, said restrictions won’t affect its production of gallium nitride power chips, Barron’s reported.

“Navitas does not expect customer deliveries to be impacted or its business to be adversely affected by the export restrictions,” a statement said, noting the company could rely on gallium sources around the world. German chip maker Infineon echoed these sentiments.

CNBC reports that the Eurasia Group, a political risk consultancy company, called the news a “warning shot, not a death blow” in a note Monday.

“These latest measures are more limited in scope, and while the new rules require Chinese exporters to first obtain a license, no language automatically bars export to specific countries or end-users,” the Eurasia Group said.

In addition, while China is perhaps the most notable producer of germanium and gallium, other countries can produce them as well.

The Associated Press contributed to this report.