China is officially moving to restrict rare earths exports to the US — less than two weeks out from a crucial trade meeting between Donald Trump and Xi Jinping.
Reuters has reported that US military firms will be the first on a possible trade blacklist, with the agency citing reports in “numerous reports from state-run Chinese media” that it’s on the way.
Meanwhile, The Global Times’ official Twitter account has reportedly published a piece indicating that US military companies “are likely to face restrictions” — citing unnamed industry insiders.
The government could also work out a list of foreign end users of China’s rare earths, the first step in exerting more strategic control over the minerals.
It also follows on from a spokeswoman for China’s key economic planner, the National Development Reform Commission, saying that the commission would study the rare earths situation and roll out new policies “as soon as possible”.
The commission recently held three symposiums on rare earths to hear views from industry experts that included suggestions to enact export controls, according to a transcript of comments from NDRC spokeswoman Meng Wei.
China’s rare earth exports in May fell by 16 percent from April to 3,640 tonnes, according to customs data released last week cited by the news agency.
The latest development on rare earths comes less than two weeks from the G20 meeting in Osaka, where it’s widely expected that US President Donald Trump and Chinese Premier Xi Jinping will meet on the sidelines to hash out a trade deal.
Rare earths have re-emerged as a key strategic resource in recent months, and one that China largely controls.
It’s led the US to re-double its efforts to find new sources, and it’s even gone as far as having discussions with project operators outside the US to secure supply.
This content does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.
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