China has imposed a sweeping export ban on six rare earth elements and specialist magnets made from them, escalating tensions with the United States following the latter’s recent tariff hikes. The move threatens to disrupt global supply chains for electric motors, microchips, and other technologies dependent on these critical materials.
The export restrictions, effective from April 4, extend beyond the U.S. and apply to all countries, according to The New York Times, which cited unnamed industry sources and officials. The halt affects neodymium-based magnets and six rare earth elements exclusively refined in China, which together account for roughly 90% of global magnet production.
See also: EU, China Reopen Talks on EV Tariffs, Consider Minimum Price Agreement
“Without access to these raw materials – or the magnets already manufactured in China – production could come to a standstill in many places,” said Michael Silver, CEO of Los Angeles-based American Elements, a chemicals company. Silver added that export licenses required under China’s earlier restrictions could take up to 45 days to process, potentially disrupting tightly coordinated supply chains.
The ban is expected to particularly impact industries reliant on permanent magnet synchronous machines (PSMs), which are widely used in electric vehicles due to their efficiency and compact size. Automakers using alternative motor technologies, such as asynchronous motors or externally excited synchronous machines, may face fewer direct effects but could still experience broader supply chain disruptions.
See also: Analysts See Limited Impact on Chinese Carmakers from New U.S. Tariffs
The Chinese government is reportedly drafting a new regulatory framework that may permanently block access for certain companies, including U.S. military contractors. The sudden halt in exports was observed at Chinese ports, although The New York Times noted that the suspension may be temporary until the new system is finalized.
Beyond the automotive sector, the restrictions are likely to reverberate across the semiconductor, aerospace, and defense industries. Rare earth elements are also used in various high-tech applications, including computer chips, lasers, spark plugs, and smartphones.
