Beijing has tightened its grip on the global supply of critical rare earth elements, suspending exports of key metals and magnets vital to industries ranging from defense to electronics.
The move, widely seen as retaliation for escalating US trade tariffs, could severely disrupt supply chains in the West.
According to The New York Times, China is halting shipments of these components—used in electric vehicles, smartphones, and missile systems—at various ports while drafting a new regulatory system.
Once finalized, this system could permanently restrict supplies to certain companies, including American defense contractors.
China dominates global rare earth production, accounting for about 90% of supply. Seven key rare earth elements, including samarium, terbium, and dysprosium, are now on Beijing’s export control list.
The US, with just one operating rare earth mine, remains heavily dependent on Chinese imports.
The new controls, effective from April 2, follow the US decision to raise tariffs on most Chinese goods to 54%. The restrictions apply not only to raw minerals but also to finished goods like magnets, which are difficult to source elsewhere.
Industry experts warn that China could throttle exports further by limiting the number of licenses it issues. The lack of a fully operational licensing system has left many companies in limbo, fearing critical shortages.
This move, which affects all global buyers, underscores Beijing’s strategic leverage over vital supply chains. Companies like Lockheed Martin, Tesla, and Apple—reliant on Chinese rare earths—may now face supply disruptions, with national security and tech innovation potentially caught in the crosshairs of a deepening trade rift.
