Details
- China’s Commerce Ministry added MP Materials and USA Rare Earth to its export control list, citing national security concerns.
- The restrictions block Chinese exporters from supplying the companies with dual-use goods that have both civilian and military applications.
- The rules also prohibit organisations and individuals outside China from transferring Chinese-origin dual-use items to the targeted firms.
- Beijing said the measures were a response to the Pentagon’s decision to add several major Chinese companies to a list of firms accused of supporting China’s military.
- Eight other US companies, including aerospace, robotics and drone manufacturers, were also added to China’s export control list.
- China’s Finance Ministry separately barred 46 US companies, mostly defence contractors, from Chinese government procurement projects.
- MP Materials operates the only major rare-earth mine in the United States and received a $400 million investment from the US Department of Defense last year.
- USA Rare Earth recently secured $1.6 billion in US government funding and is expanding access to overseas rare-earth resources through acquisitions.
- The measures come days after G7 countries agreed to reduce dependence on any single foreign supplier for rare earths and permanent magnets.
- China accounts for about 60% of global mined rare-earth production, more than 90% of refining and almost 95% of permanent magnet production.
- Analysts said the immediate impact may be limited because several targeted firms have little direct China exposure, but the move still signals Beijing’s willingness to use rare earths as leverage.
- Shares of MP Materials and USA Rare Earth rose after the announcement, suggesting investors expected limited immediate operational disruption.
What Else
The dispute could deepen competition between Washington and Beijing over critical mineral supply chains as both sides try to reduce dependence on each other. Even if the latest curbs are partly symbolic, they show how rare earths remain one of China’s strongest tools of economic pressure.
