China’s rare-earth export control exemption for one year
Femy Francis
On 30 October, China announced that it will postpone the latest rare earth export measures for one year. This came after the high-profile meeting between US President Donald Trump and China’s President Xi Jinping, leading to a trade truce. During this meeting, China also agreed to buy 12 million metric tonnes of soybeans and a minimum of 25 million tonnes per year for the next three years. While the tariffs and taxes on imported goods will remain the same. European Commission (EC) spokesperson Olof Gill welcomes this measure, stating that this is an appropriate and responsible step to ensure the stability of global trade. The EU Commissioner for Trade and Economic Security, Maros Sefcovic, also confirmed with China’s Ministry of Commerce (MOFCOM) that these suspensions also apply to the EU.
What was the rare earth export restriction by China?
On 09 October, China’s Ministry of Commerce (MOFCOM) announced that it will expand its export control of rare earth materials and dual-use technologies. Under the new measure, five rare earth elements were added, and this amendment also includes an export license for products made in China with Chinese material or technologies. As per the new provision, there are now 12 out of 17 rare earths under control; these are holmium, erbium, thulium, europium, and ytterbium. Foreign firms now require an export license from China’s State Council of the Commerce Department, which will take 45 days to process. This was scheduled to come into effect from 08 November 2025, but was halted for a year after the Xi-Trump meeting. They were also required to get dual-use item export licenses if manufactured outside China using Chinese material or technology. It also officially banned the application of the export licences for overseas military users.
China’s monopoly over the rare earth supply chain
China plays a critical role in the production of the global electronics supply chain, producing semiconductors and circuit boards, as it is the single largest provider of rare earths and critical minerals. It is estimated that 90 per cent of the supply of refined rare metals and 70 per cent of lithium and cobalt comes from China. It was in 2016 when China first imposed export control over rare earths processing technology. As of 2025, China has the largest reserves in the world, with 44 million tons in reserves. The rare earths aren’t as rare as the capacity to refine them. Therefore, China has heavily invested in refiners across the world and dominates the supply chain of rare earths by being the largest investor in mines.
Alternative to the Chinese rare earth supply chain
Before meeting China’s President Xi Jinping, US President Donald Trump signed a series of agreements on critical mineral deals with Australia, Cambodia, Japan, Malaysia, Thailand, and Vietnam. These deals pledge to have investments in processing, a minimum floor price to incentivise production, and bans on export restrictions. The major agreement was between the US and Australia, signed on 20 October, securing the supply of critical minerals and metals. As part of the deal US DoW will invest in the construction of a 100 metric ton-per-year advanced gallium refinery in Western Australia. Japan is also collaborating on projects within the US-Australia deal.
References
“How Will China’s Rare Earth Export Controls Impact Industries and Businesses?,” China Briefing, 30 October 2025
“EU welcomes China's one-year rare earth export controls suspension; expert says message highlights EU reliance, concern,” Global Times, 02 November 2025
“Trump’s Asia tour moved to counter China’s critical minerals dominance,” Chatham House
“China controls the rare earths the world buys - can Trump's new deals change that?,” BBC, 27 October 2025
