Highlights

• China's rare earth magnet exports rebounded 157% in June after a two-month licensing procedure slowdown.
• Export volumes remain 38% lower than last year, with uneven recovery across different global markets.
• Geopolitical tensions and supply chain uncertainty continue to impact rare earth magnet trade, particularly with U.S. and European markets.

After a turbulent spring, China’s rare earth magnet exports bounced back sharply in June, climbing 157% month-over-month to 3,187 tons. The surge follows a two-month slump caused by delays in Beijing’s new licensing procedure for rare earth exports—particularly those containing heavy rare earths vital to EVs, robotics, and defense manufacturing.

According to Invezz reporting by Sayantan Sarkar, while June’s export total marked a substantial recovery from May, volumes remain 38% lower than the same period last year and among the weakest since February 2021, discounting the license freeze months. The export lag has created lingering uncertainty for Western manufacturers dependent on China’s dominance in magnet supply chains.

Commerzbank FX analyst Volkmar Baur (opens in a new tab) emphasized that recovery remains uneven. Exports to Germany were still 25% below 2024 levels, and shipments to the U.S. were more than 50% lower year-on-year. One outlier: Thailand, where permanent magnet imports from China hit a record 200+ tons in June, suggesting regional supply chain shifts may be underway.

The export normalization coincides with signals of a geopolitical thaw between China and the U.S., including the resumption of rare earth shipments and early-stage trade negotiations. However, with no clear long-term framework in place, the rare earth sector remains exposed to policy whiplash.

Key Questions for Investors:

• Will Beijing’s licensing reforms become recurring chokepoints in global magnet supply?
• Is Thailand’s record intake a sign of rerouted demand—or a strategic buildup of reserves?
• How will the U.S., EU, and Japan respond to continued export volatility—via reshoring, partnerships, or stockpiling?

REEx Take: China’s June rebound in rare earth magnet exports brings short-term relief—but persistent year-on-year declines highlight the fragility of global supply chains. Investors should track not just volumes, but destination flows and licensing policy trends, as these will shape the near-term magnet market more than price alone.

Source: Invezz (opens in a new tab) | Author: Sayantan Sarkar