New Restrictions on Rare Element Exports from China

Restrictions on Rare Elements by the Chinese Ministry of Trade

The Chinese Ministry of Trade has made an important announcement regarding the export of rare earth elements. According to the announcement, restrictions have been imposed on the export of technologies related to the extraction, smelting, separation, and production of magnet materials of rare earth elements.

Controls for Domestic and Foreign Companies

Additionally, the transfer of technologies related to the installation and maintenance of assembly lines in facilities processing rare elements has also come under scrutiny. Foreign companies exporting rare earth elements produced in China are now required to obtain a license from the Ministry of Trade for products intended for civil and military use.

Emphasis on Military Use and National Security

These restrictions were introduced due to security concerns arising from the potential military and civil use of rare earth elements. The ministry highlighted that this situation could pose a threat to China's national security.

Applicable to Foreign Producers as Well

Producers using products and technologies imported from abroad are also subject to similar restrictions, and this regulation is set to take effect on December 1, 2023.

A Strategic Move Ahead of the APEC Summit

This decision was made during a period of ongoing tense negotiations between the USA and China. As the leaders of the two countries plan to meet during the APEC Summit, these restrictions carry a significant implication.

China's Market Dominance and Protection Strategy

According to data from the U.S. Geological Survey, it is expected that global production of rare earth elements will reach 390,000 tons in 2024, with 270,000 tons of this production occurring in China. Holding approximately 69 percent of the world's rare earth element market, China dominates global supply.