Highlights

• U.S. lifts export restrictions on EDA software and ethane to China after bilateral negotiations
• Three major EDA software companies can now resume sales to Chinese clients
• Trade policy shifts linked to rare earth element export negotiations between U.S. and China

Rare Earth Exchanges (REEx), a platform for retail investors in rare earth and critical mineral markets finds that the United States government is easing key export restrictions on technology and materials to China. According to a Quartz (opens in a new tab) report by Niamh Rowe, Washington has "rolled back export restrictions on key technologies and raw materials to China, signaling a possible softening in trade tensions". This policy shift affects U.S. chip design software providers and ethane exporters and comes as Beijing makes concessions on rare earth elements.

U.S. Lifts Tech and Energy Export Curbs

Two U.S. electronic design automation (EDA) software giants—Synopsys and Siemens—have confirmed they can once again supply Chinese clients after the Department of Commerce lifted bans on their sales. Cadence Design Systems also received notice that its software exports to China could resume. Without this reversal, China’s chip design capacity would have been severely hindered, since those three U.S. firms provide over 70% of China’s EDA tools.

On the same day, U.S. officials removed new licensing requirements on ethane exports to China that had been imposed this spring. Those curbs were a response to China’s April move to restrict rare earth exports, a step that had alarmed U.S. industries reliant on those critical minerals.

Rare Earths at the Center of Talks

Bilateral negotiations yielded a new framework for sensitive exports: China will vet applications for controlled goods like ethane while the U.S. eases corresponding limitations. A Reuters source explained, “The U.S. imposed sweeping restrictions to pressure China into easing up on rare earths. Now, with that goal achieved, they're rolling things back”. The source added that additional trade barriers will be lifted, moving trade policies closer to their pre-April status.

Key Questions for Investors

• Has China fully reversed its rare earth export curbs under this new agreement, and how will the export approval process be implemented?
• Will easing tensions reduce U.S. efforts to develop alternative rare earth supply chains, or will supply diversification remain a priority?
• Could trade friction resurge, potentially putting rare earth and critical mineral supplies at risk again?