Rare Earth Exchanges

China’s Export Ban on Critical Minerals: A Strategic Move in the US-China Trade War?

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Highlights

  • China halts exports of germanium, gallium, and antimony, demonstrating its leverage in global critical mineral markets.
  • US faces significant challenges in reducing dependence on Chinese mineral supplies, with alternative sourcing taking years to develop.
  • Beijing’s export restrictions serve as both a trade war tactic and a negotiation tool against US economic pressures.

A recent (opens in a new tab) South China Morning Post article, authored by the SCMP editorial team, delves into China’s strategic use of critical mineral export bans as a lever in its trade tensions with the United States. The piece highlights the ripple effects of Beijing’s restrictions on exports of germanium, gallium, and antimony, materials essential to industries ranging from semiconductors to defense. Following a complete ban on gallium and germanium exports in 2023, China halted antimony exports in October 2024, doubling its price by January 2025. These moves underscore Beijing’s capacity to disrupt supply chains critical to the U.S., which relies on China for up to 60% of its critical mineral needs.

The Message

The article posits that Beijing’s export restrictions are both a retaliatory response to U.S. tariffs and a negotiating tool for broader trade talks with the incoming Trump administration. Analysts, including Ellie Saklatvala (opens in a new tab) of Argus Media, warn that the U.S. faces a steep uphill battle in reducing reliance on China due to the time and investment required to develop alternative supply chains. The report also notes U.S. efforts to secure resources from other countries, such as a $150 million investment in a Mozambique graphite project and the approval of a domestic antimony mine, which will not come online until 2028. However, these are not enough as they do not address the processing and production problem.

Core Message and Media Position

The article’s core message is that China’s mineral export bans demonstrate its willingness to escalate the trade war and exploit its dominant position in critical material supply chains. SCMP appears to position itself as a neutral observer but implicitly underscores the effectiveness of China’s strategy while questioning the U.S.’s readiness to respond. The tone suggests a subtle bias favoring China’s tactical success, emphasizing its preparedness and long-term planning in contrast to U.S. vulnerabilities.

Bias and Omissions

While the article accurately outlines the strategic implications of China’s export bans, it appears to downplay the potential global ramifications of Beijing’s actions, such as the disruption to allied supply chains beyond the U.S. Additionally, it omits broader geopolitical concerns, including how China’s restrictions might trigger a concerted Western response to counter its dominance, such as deeper U.S.-EU collaborations or domestic supply chain investments.

Rare Earth Exchanges has chronicled China’s fear of a massive, concerted, and orchestrated U.S. effort to invest in rare earth element infrastructure for resilience. So far, it does not appear that the Trump administration understands the real problem, but of course, this could be a cover for the president.

Implications

This situation raises critical questions about the sustainability of U.S. reliance on Chinese minerals and the pace at which alternative sources can be developed.

While the export bans grant Beijing leverage in trade talks, they could backfire by accelerating the diversification of global supply chains and reducing China’s long-term influence in critical materials markets. This evolving dynamic underscores the need for proactive action and reminds all readers that the fundamental chokehold China has remained over-processing refining, and value-added production, such as magnets.

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