China Tightens Rare Earth Export Controls Ahead Of Key US Trade Talks
China has announced new export restrictions on rare earth elements and other critical materials used in advanced technologies, escalating tensions with the United States just weeks before a planned meeting between President Xi Jinping and Donald Trump.
Beijing, which dominates the global supply of rare earths — processing about 90% of the world’s output — said the move is intended to “safeguard national security.” However, analysts view the timing as a strategic play in China’s broader trade standoff with Washington.
Stricter Approvals For Foreign Companies
Under the new regulations, foreign companies must now obtain government approval to export any products containing rare earth materials — even in trace amounts — and must disclose the intended end-use.
The Commerce Ministry also extended similar export limits to lithium batteries and certain forms of graphite, key components in electric vehicles, smartphones, and renewable energy systems.
In addition, Chinese firms are banned from cooperating with foreign companies in the rare earths sector without explicit state authorization. Even technology related to mining, smelting, magnet manufacturing, and recycling now falls under the same export control umbrella.
Beijing also specified that maintenance, assembly, and upgrading of production equipment related to rare earth processing cannot be conducted abroad without approval.
A Strategic Counter To US Chip Restrictions
The move mirrors Washington’s export curbs that restrict other countries from selling semiconductor manufacturing equipment to China. Trade experts say Beijing’s latest measures are a retaliatory mirror image, designed to pressure the US ahead of high-stakes trade negotiations.
“China is targeting key vulnerabilities in US electronics and weapons manufacturing,” said Alex Capri, a trade specialist. “The timing — right before the Xi-Trump meeting — is deliberate.”
The US, while possessing its own rare earth deposits, relies heavily on Chinese refining capacity, a dependence that has long been seen as a strategic weakness. The lack of domestic processing plants leaves American industries — particularly defense and high-tech manufacturing — exposed to supply disruptions.
Potential Impact On Global Supply Chains
Rare earths are essential to a wide range of modern technologies, from solar panels and wind turbines to electric car motors and smartphones. They are also critical to missile guidance systems and jet engines, making them indispensable to both commercial and military applications.
Among the 17 rare earth elements are neodymium, used in powerful magnets; yttrium, used in LEDs and lasers; and europium, vital for television and computer displays.
While these elements are relatively abundant in nature, they are difficult and environmentally hazardous to extract and purify. The International Energy Agency (IEA) estimates that China accounts for 61% of global rare earth production and 92% of global processing, giving it unparalleled leverage over supply chains.
The new rules could intensify global shortages of high-tech materials, driving up prices and forcing manufacturers in the US, Europe, and Japan to accelerate efforts to diversify their supply chains.
Balancing Trade And Technology Power
Beijing’s decision underscores the growing weaponization of technology and raw materials in international trade. By tightening its grip on rare earth exports, China is sending a clear message that it will not remain passive in the face of Western restrictions on chip technology.
As the world’s two largest economies prepare for renewed talks, analysts say the rare earth dispute could become a bargaining tool in wider negotiations over tariffs, market access, and AI-related technologies.
For now, global manufacturers — especially those in the electronics, defense, and renewable energy sectors — face an uncertain path forward, as Beijing’s latest export rules reshape the balance of technological power between East and West.
