China deploys rare earths as economic weapon

As U.S. tariffs tighten the screws on China’s export machine, Beijing is striking back with strategic precision. Export restrictions on rare earths are now Beijing’s latest move to break down European trade barriers and push back against escalating pressure from Washington.

In today’s global trade standoff, the gloves are off. The U.S. is wielding its market clout -- 25% of global consumption originates from the American domestic market. Anyone in the export business must deal with the United States. China, meanwhile, holds an current monopoly on rare earths -- and is making it clear it will not hesitate to weaponize that dominance. The stakes are rising, and national interests now override globalist courtesies.

No Friends -- Only Alliances

Europe is learning the hard way: in geopolitics, there are no friends, only temporary alliances. China’s tightened export controls on rare earth elements risk plunging Germany’s industrial sector into a severe resource crisis. With nearly 85% of global rare earth refining under its control, Beijing is the chief supplier of key metals like dysprosium, terbium, and yttrium -- critical for electric motors, medical tech, and defense systems.

Since April 2025, access to these raw materials has been restricted to licensed exporters only -- a de facto embargo. The fallout is immediate: several German manufacturers have already been forced to scale back operations. Others face complete shutdowns. Industrial metal prices continue climbing, and the fragility of global supply chains is now exposed in brutal detail. Europe’s resource dependency is becoming a major liability -- and a strategic weakness in the coming trade war negotiations.

Target: New Markets

China’s export curbs are a calculated pressure tactic in its standoff with both the U.S. and EU. Beijing is feeling the squeeze from the Trump administration’s hardline trade policy.

Dysprosium is used to produce neodymium-iron-boron (NdFeB) magnets, which are crucial for electric vehicle motors and the efficient operation of wind turbines.[9] It is used for its high thermal neutron absorption cross-section in making control rods in nuclear reactors, for its high magnetic susceptibility (χv ≈ 5.44×10−3) in data-storage applications, and as a component of Terfenol-D (a magnetostrictive material).

https://en.wikipedia.org/wiki/Dysprosium

The most important present-day use of yttrium is as a component of phosphors, especially those used in LEDs. Historically, it was once widely used in the red phosphors in television set cathode ray tube displays.[9] Yttrium is also used in the production of electrodes, electrolytes, electronic filters, lasers, superconductors, various medical applications, and tracing various materials to enhance their properties.

https://en.wikipedia.org/wiki/Yttrium

A lot of the items used in our DEFENSE depend on rare earths.

Rare earth elements are crucial to many advanced military technologies. They are used in fighter jets, submarines, missile systems, radar, sonar, and precision-guided munitions.

F-35 Lightning II jets contain over 900 pounds of rare earth materials in their electronic systems and actuators. - Virginia-class submarines require approximately 9,200 pounds of rare earths.

Heck, Rare earths are essential for radar systems, fiber optics, laser range finders, and sonar transducers.

It was totally foolish and short sighted of us to depend on a hostile country to supply our rare earths. They could cripple us anytime they want.

NOW, The U.S. Department of Defense is working to establish a domestic supply chain to reduce reliance on foreign sources, particularly China, which dominates global rare earth production. But that won’t happen immediately.

China is using critical rare earths as a weapons.

“The United States relies heavily on imports for its supply of rare earths, with China being the primary supplier. In 2024, 77% of U.S. rare earth imports came from China.”

But:

“The United States does have significant deposits of rare earth elements...crucial for a wide variety of technological applications, including electronics, military equipment, and renewable energy technologies.”

Why is it not mined and processed right here in the U.S.?

“The refining of the ores is pretty expensive especially if it is processed ‘cleanly’ as required under US-EPA rules. The process is also pretty toxic and dangerous to the labor working the refineries. This actually is the only reason this stuff is refined in China. The USA will not without considerable safety and environmental rules allow the processing of it in the country.

The ores mined in California are put on ships, hauled into China, processed and then sold back to the USA at very high prices. China then treats them as national property and lords over their use in favor of the Chinese Communist Party (CCP). “

There you have it, we are screwed over twice by China.

What are “earths”? It sounds like Indian call center Ebonics.

As far as we know Earth is the only planet with life so it is indeed rare. How does China have earths?

I am not a grammarian by any stretch of the word but there needs to be somewhere touch back on adopting Indian call center usage of the English language. It is annoying as “maths”.

Is it too hard to write rare earth elements?

Industry, managers watching Wall Street for short-term profits, leftists, greens and NIMBY types all sent this processing to China in the late 1990s.

China took it and steadily moved up the technology and product development ladder to the point where they controlled the world supply and new technology in rare earth processing and magnets - and few, if any, Americans remained with such skills. And yes, they did it with state support and strategic planning.

So we really have no one to blame but ourselves.

It will take 10-15 years to fix the problem, so we’d better start now.

“Rare earth” are not particularly rare, only not always economically easy to get. China with no real environmental restrictions can mine for these rare earths without anyone stopping them because of the environment.

The United States has deposits of “rare earth” but the environmentalist would go crazy if we tried to mine them like the Chinese.

Having said that, if it becomes in the national interest, then I think we could supply all our needs internally. It would just take time to get up to speed.

It's not really all that rare, but the process to get them is a messy process:

Rare Earths Reserves: Top 8 Countries

We are listed as the 7th, but then I question the amount the state, because we really are not looking for it, and they are the known, while there is most likely much more that is unknown.

However, if alternatives can be created, it certainly wouldn't hurt, buy the supplies currently supply would take hundreds of years to run through. Because it is the millions of metric tons that are known to exist currently.

It is always fascinating to see how a free market responds to challenges. Seems to me that with any commodity shrinkage the forces of supply and demand on prices can help make a business case for investors (exploration, alliances, alternative products, technology, funding for research, etc.). Business conditions can inspire innovation and a paradigm shift solving a problem in such a manner that the original problem to solve becomes inconsequential.

Not downplaying the importance of these metals or suggesting that a supply solution arrives overnight. Rather that our form of governance, freedoms, and capitalism put us in a position to not be held ransomed to a fat old Chinese guy trying to fund his next Potemkin village.

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