US Lawmakers Urge Ban on Purchases of China’s CXMT, YMTC Memory Chips

Lawmakers send letter to Commerce secretary

Move targets Apple’s effort to adopt CXMT chips

‘Unacceptable risk’ to US security

Call for coordinated action with South Korea, Japan and the EU

US lawmakers are pressing the Trump administration to ban purchases in the US of memory chips made by China’s ChangXin Memory Technologies, or CXMT, and Yangtze Memory Technologies Co., or YMTC, as Washington moves to curb reliance on Chinese suppliers for semiconductors used in artificial intelligence infrastructure.

The Financial Times reported on July 16 that Representative John Moolenaar, chairman of the House Select Committee on China, and Democratic Representative George Whitesides sent a letter to Commerce Secretary Howard Lutnick urging such action. In the letter, they argued that dependence on Chinese memory chips poses “an unacceptable risk to America’s national security, economic security and supply chain security.” The push followed an FT report that Apple had been lobbying the Trump administration for approval to use CXMT products.

The lawmakers also criticized signs that US tech companies, including Apple, are considering Chinese memory chips as global DRAM prices rise and supply tightens. “China’s major memory semiconductor manufacturers are all closely tied to the Chinese military,” Moolenaar said. Purchases by US companies, he added, would directly support the People’s Liberation Army’s development of critical technologies with both military and civilian applications.

The Pentagon added CXMT this year to its list of Chinese military companies. Being placed on that list does not automatically prohibit US companies from doing business with the firm. The lawmakers called for separate rules barring US companies from buying semiconductors from companies on the Defense Department’s Chinese military companies list or the Commerce Department’s export control list. They also urged the administration to add CXMT to the export control list and tighten sanctions on YMTC, which is already included.

The letter also called for a coordinated response with allies. The lawmakers urged the US to work with South Korea, Japan and the European Union to keep CXMT and YMTC from entering allied supply chains as global memory shortages create an opening.

CXMT and YMTC are Chinese memory chipmakers focused on DRAM and NAND flash, respectively. Most of their sales still go to China’s domestic market. Their advanced manufacturing capacity lags global rivals because of US restrictions on exports of semiconductor manufacturing equipment. Still, aggressive investment and capacity expansion could give them greater influence over global memory prices and supply chains over time.

Counterpoint Research estimates that CXMT currently holds a 9% share of global DRAM bit shipments. The company is poised to raise about $10.1 billion through a listing this month on Shanghai’s Star Market, further expanding its scale. YMTC is also preparing for an initial public offering. Neil Shah, a vice president at Counterpoint Research, said CXMT’s recent market-share gains, Apple’s lobbying, broader export expansion and a potential entry into the high-bandwidth memory, or HBM, market are creating the conditions for further growth.

Hong Min-seong, Hankyung.com reporter mshong@hankyung.com