Online Reporter
China has expanded its use of critical minerals as a trade weapon with curbs on exports of rare earths, threatening to shake-up the global supply of key materials used widely in high-tech manufacturing from electric vehicles to weaponry.
As part of its retaliation to President Donald Trump’s so-called reciprocal tariffs on imported Chinese goods, Beijing said Friday it will tighten controls on exports of seven types of rare earths.
The country is by far the world’s biggest supplier of the minerals, which comprise 17 elements in the periodic table.
The move triggered big gains for related stocks on Monday, with China Rare Earth Holdings rising as much as 10 percent in Hong Kong.
China Northern Rare Earth Group added as much as 9,2 percent, and Australia’s Lynas Rare Earths as much as 5,1 percent.
China accounts for almost 70 percent of the world’s production of rare earths, according to the US Geological Survey.
Its grip on a host of niche commodities has long been viewed as a potential geopolitical weapon, given America’s reliance on Chinese supplies. Beijing had already rolled out similar curbs on other critical minerals, such as gallium, germanium, graphite and antimony, over the past two years amid rising trade tensions.
The latest export controls aren’t a blanket ban, but they mean that any overseas shipments will be subject to greater scrutiny over who is buying, and why. Other metals have seen export volumes crash to zero after controls were rolled out, with exporters needing time to get certified. — Bloomberg
