By Alexander Miller, consultant in energy and mining markets. Eurasia Business News, October 16, 2025. Article n°1827

Tensions over rare earths between the U.S. and China have sharply escalated in October 2025 as China significantly broadened its export controls on critical rare earth elements and technologies. China added five new rare earth metals to its restricted export list, totaling 12 of the 17 rare earths now under strict controls. These metals are essential for manufacturing a wide range of high-tech products including electric vehicles, semiconductors, and U.S. defense systems such as F-35 jets, Tomahawk missiles, and radar technologies.

China’s Ministry of Commerce announced these enhanced export restrictions citing national security concerns, accusing certain foreign entities of misusing rare earth materials for military or sensitive applications. For the first time, China is applying a foreign direct product rule that requires government approval for any foreign-produced rare earth magnets or semiconductor materials that contain Chinese rare earth components or were made with Chinese technology. These new export licenses, effective December 1, 2025, aim to prevent direct or indirect contribution of Chinese rare earths to foreign military supply chains.

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The U.S. government has condemned the move as economic coercion and a tactic to leverage its near-monopoly—approximately 90% of global processing and refining of rare earths—in strategic trade negotiations. Secretary of Treasury and U.S. Trade Representative officials have warned China to retract these controls or face escalated U.S. tariffs. This rare earth dispute is a critical flashpoint in the ongoing U.S.-China trade war, impacting global supply chains for key technological and defense industries just ahead of a scheduled summit between Presidents Trump and Xi Jinping.

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© Copyright 2025 – Eurasia Business News. Article no. 1827