Highlights
- China offers limited rare earth export permits following US-China trade talks
- Provides short-term relief but maintains strict control
- Critical heavy rare earths remain restricted
- Potential manufacturing shutdowns for US and European industries
- Experts warn that China continues to control rare earth supply chain until Western nations develop comprehensive mining and production capabilities
In a fragile outcome from the latest U.S.-China trade talks, Beijing has granted a limited number of rare earth export permits, offering short-term relief to U.S. industries but leaving deeper vulnerabilities unresolved. The move follows President Trump’s announcement that China agreed to resume select shipments of rare earth elements and magnets after two days of high-level negotiations in London.
China’s commerce ministry confirmed the permits but emphasized the controls remain part of a permanent licensing regime—a geopolitical tool wielded under the banner of national security. Critical heavy rare earths like terbium and dysprosium, vital for EVs, wind turbines, and military hardware, remain restricted and subject to case-by-case approval.
“The world economy doesn’t function without heavy rare earths,” warned NioCorp CEO Mark Smith (opens in a new tab), whose Nebraska-based project remains years from full-scale production. Meanwhile, European automakers and original equipment manufacturers (OEMs) are already reporting shutdowns, with U.S. manufacturers not far behind.
As Benchmark Minerals’ Neha Mukherjee (opens in a new tab) noted, “the stockpile is in China,” and U.S. firms may face constraints within months.
The so-called breakthrough is tactical, not structural. Until the West invests in full-spectrum rare earth mining, refining, and magnet-making capacity, China will continue to control the choke point. Investors should treat this reprieve not as a resolution, but as a warning, as cited by AP News.
When do you think will this short term reprieve will be implemented by the China ministry of commerce?