China Stops Sending Some Rare Earth Minerals to the U.S.

Some companies in China have stopped sending rare earth minerals to the United States. Rare earths are special metals used to make phones, electric cars, and military equipment. Three sources told the news agency Reuters about the problem in early September. The companies say they are afraid of getting in trouble with the Chinese government if they keep selling to American buyers.

Rare earth minerals are hard and expensive to process, even if they are not truly rare underground. China produces more of these minerals than any other country. That gives China a lot of power in global trade and technology. When China limits who can buy these minerals, it causes big problems for industries worldwide.

The trouble grew in early August when China punished a U.S. organization called the Responsible Business Alliance, or RBA. The RBA checks whether companies follow safe and fair rules when they mine and sell minerals. Chinese suppliers feared that working with RBA-connected companies could get them in trouble with Beijing. So some of them stopped sending shipments to the U.S. altogether.

Other Chinese companies had already stopped shipping rare earths to the U.S. before August. They wanted to avoid getting caught in the growing fight between China and America over trade and technology. One source described at least four cases where Chinese firms refused to send materials. They worried the goods might end up with banned companies or users.

Some rare earths have become very expensive because of these shipping slowdowns. Materials like yttrium, indium phosphide, and tungsten are used in aerospace, computer chips, and military tools. Their prices have stayed near record highs because supply is so tight. Some U.S. companies have been waiting more than six months just to get permission to receive these minerals.

U.S. officials have asked China many times to honor agreements made in cities like Busan and Beijing. These agreements were meant to keep minerals flowing smoothly between the two countries. The issue became important enough to land on the planning list ahead of Chinese President Xi Jinping's visit to Washington on September 24. Officials hoped the summit could help ease the tensions.

Reva Goujon, a geopolitical strategist at a research group called Rhodium Group, said China has used these export controls very skillfully. She thought China might loosen some restrictions around the time of the summit to reduce tensions. That way, China could seem cooperative without giving up its trade leverage entirely. It would be a careful and calculated move.

Japan and India have faced even stricter limits than the U.S. on getting rare earth minerals from China. Between January and August of one recent year, China sent zero terbium to Japan, compared to 20 tons in the same period the year before. Shipments of yttrium to Japan dropped 98 percent, and gallium fell 65 percent. Terbium and gallium are used to make powerful magnets in many high-tech devices.

European companies have also struggled to get access to rare earth materials. The European Chamber of Commerce in China said its members still face problems even when the process is supposed to be easier. The group wants China to create a clear and fair system for approving applications. Right now, companies say the process is unpredictable and hard to plan around.

There have been a few small signs that things could improve. China sent 27 tons of yttrium to the U.S. in July, the second-highest monthly total since January of that year. Some U.S. companies reported getting multiple licences approved after long waits. Still, the bigger fight over rare earths and technology between the two countries is far from over.