Rarer earths: Mainland China expands critical mineral export controls

The government of mainland China has extended the list of critical minerals restricted under dual-use export license rules. These include rare earths used in the production of permanent magnets, with the list covering 97 products from ores to completed products made of dysprosium, scandium and yttrium, among others. 

The action has not been specifically linked to US tariffs, but as in the case of the prior expansion of export restrictions, the timing is coincidental with the Chinese government’s tariff increases.

While the US has not been targeted specifically, the new licensing requirements likely aim to allow China to deny licenses to countries suspected of reexporting restricted materials to the US, as occurred with gallium and germanium exports, which were rerouted to the US through South Korea and Japan following China’s imposition of restrictions in July 2023.

The US accounted for 9.7% of China’s exports of the products covered by the restrictions in the 12 months to Feb. 28, 2025, Market Intelligence data shows. Other leading buyers include South Korea, the EU and India.

The increased use of export restrictions may slow the development of manufacturing in key energy transition and electronics sectors in the US as producers look to secure alternative or domestic supplies.

The supply of rare earth materials has also been complicated recently by the earthquake in Myanmar, a major supplier of raw materials almost exclusively to China.

China’s exports of the materials covered surged 21.4% year over year in the three months to Feb. 28 in volume terms and by 18.3% in value terms. That may indicate a front-loading of purchases by firms concerned about such widening restrictions, with exports to South Korea up by 56.1% in value terms and those to the US rising 10.8%.

This article was published by S&P Global Market Intelligence and not by S&P Global Ratings, which is a separately managed division of S&P Global.