Beijing is gearing up to use its dominance of rare earths to hit back in its deepening trade war with Washington.
A flurry of Chinese media reports on Wednesday, including an editorial in the flagship newspaper of the Communist Party, raised the prospect of Beijing cutting exports of the commodities that are critical in defense, energy, electronics and automobile sectors. The world’s biggest producer, China supplies about 80% of U.S. imports of rare earths, which are used in a host of applications from smartphones to electric vehicles and wind turbines.
The threat to weaponize strategic materials ratchets up the tension between the world’s two biggest economies before an expected meeting between Presidents Xi Jinping and Donald Trump at the G-20 meeting next month. It shows how China is weighing its options after the U.S. blacklisted Huawei Technologies Co., cutting off the supply of American components it needs to make its smartphones and networking gear.
“China, as the dominant producer of rare earths, has shown in the past that it can use rare earths as a bargaining chip when it comes to multilateral negotiations,” said George Bauk, Chief Executive Officer of Northern Minerals Ltd., which is producing rare earth carbonate from a pilot-scale project in Western Australia.
The U.S. shouldn’t underestimate China’s ability to fight the trade war, the People’s Daily said in an editorial Wednesday that used some historically significant language on the weight of China’s intent.
Jerome Powell Now Considering Move to Spite Trump: Report
Franklin Graham defends Trump in letter shared on Truth Social after AI ‘Jesus’ image backlash
Iranian Economy on the Brink: US Blockade Leaves Country with Weeks of Oil Production Left
Acting ICE Director Todd Lyons submits resignation letter to DHS Secretary Markwayne Mullin
If You’ve Ever Thought Life Is Too Painful to Be Worth Living, This Piece Might Just Change Everything
Shouting match erupts between RFK Jr and Dem lawmaker over his comments about Black children
Hillary Clinton rips Trump on migrant child detentions, but Bill Clinton’s own record cuts deep
10 House Republicans Side with Democrats in Bid to Block Trump from Deporting Haitian Immigrants
Chuck Grassley, the longest-serving senator, hints at a ninth term
Federal agency approves Trump’s plan for triumphal arch ahead of America 250
FBI has received DNA data from Nancy Guthrie case: sources
Sailors injured after fire breaks out on aircraft carrier USS Eisenhower during shipyard maintenance
Missing general, scientist deaths tied to secret US work prompt White House probe
Illegal aliens are getting taxpayer-funded boob jobs and sex change ops in Newsom’s California, watchdog says
Eleven House Republicans vote to rebuke Trump and protect 350,000 Haitian migrants
The newspaper’s commentary included a rare Chinese phrase that means “don’t say I didn’t warn you.” The specific wording was used by the paper in 1962 before China went to war with India, and “those familiar with Chinese diplomatic language know the weight of this phrase,” the Global Times, a newspaper affiliated with the Communist Party, said in an article last April. It was also used before conflict broke out between China and Vietnam in 1979.
On rare earths specifically, the People’s Daily said it isn’t hard to answer the question whether China will use the elements as retaliation in the trade war.
China is “seriously” considering restricting rare earth exports to the U.S. and may also implement other countermeasures, the editor-in-chief of the Global Times, said in a tweet. An official at the National Development & Reform Commission told CCTV that people in the country won’t be happy to see products made with exported rare earths being used to suppress China’s development.
Editorials in the Global Times and Shanghai Securities News took similar tacks in their Wednesday editions.
Jerome Powell Now Considering Move to Spite Trump: Report
Franklin Graham defends Trump in letter shared on Truth Social after AI ‘Jesus’ image backlash
Iranian Economy on the Brink: US Blockade Leaves Country with Weeks of Oil Production Left
Acting ICE Director Todd Lyons submits resignation letter to DHS Secretary Markwayne Mullin
If You’ve Ever Thought Life Is Too Painful to Be Worth Living, This Piece Might Just Change Everything
Shouting match erupts between RFK Jr and Dem lawmaker over his comments about Black children
Hillary Clinton rips Trump on migrant child detentions, but Bill Clinton’s own record cuts deep
10 House Republicans Side with Democrats in Bid to Block Trump from Deporting Haitian Immigrants
Chuck Grassley, the longest-serving senator, hints at a ninth term
Federal agency approves Trump’s plan for triumphal arch ahead of America 250
FBI has received DNA data from Nancy Guthrie case: sources
Sailors injured after fire breaks out on aircraft carrier USS Eisenhower during shipyard maintenance
Missing general, scientist deaths tied to secret US work prompt White House probe
Illegal aliens are getting taxpayer-funded boob jobs and sex change ops in Newsom’s California, watchdog says
Eleven House Republicans vote to rebuke Trump and protect 350,000 Haitian migrants
The nation’s producers have rallied hard in recent weeks on the view that rare earths could be an ace in the trade war. President Xi Jinping visited a plant earlier this month, accompanied by his chief trade negotiator with the U.S., fueling speculation that the strategic materials could be weaponized in China’s tit-for-tat with the U.S.
Rare earths have already featured in the trade dispute. The Asian country raised tariffs to 25% from 10% on imports from America’s sole producer, while the U.S. excluded the elements from its own list of prospective tariffs on roughly $300 billion worth of Chinese goods to be targeted in its next wave of measures.
Rare earths aren’t particularly rare. Cerium, the most abundant, is more common in the Earth’s crust than copper. All other rare-earth elements, besides promethium, can be found more widely than silver, gold, or platinum, according to the U.S. Geological Survey. However, concentrated and economic deposits are scarce, and production is dominated by a handful of countries. China is the biggest by far, accounting for almost 70% of global production and 40% of the world’s reserves, USGS data show.
China’s rare earth market is dominated by a handful of producers including China Northern Rare Earth Group, Minmetals Rare Earth Co., Xiamen Tungsten Co. and Chinalco Rare Earth & Metals Co. The nation has form in using the elements to make a political point. It blocked exports to Japan after a maritime dispute in 2010, although the consequent spike in prices saw a flurry of activity to secure supplies elsewhere, which would be the risk again if Beijing follows through with its threat of retaliation.
Jerome Powell Now Considering Move to Spite Trump: Report
Franklin Graham defends Trump in letter shared on Truth Social after AI ‘Jesus’ image backlash
Iranian Economy on the Brink: US Blockade Leaves Country with Weeks of Oil Production Left
Acting ICE Director Todd Lyons submits resignation letter to DHS Secretary Markwayne Mullin
If You’ve Ever Thought Life Is Too Painful to Be Worth Living, This Piece Might Just Change Everything
Shouting match erupts between RFK Jr and Dem lawmaker over his comments about Black children
Hillary Clinton rips Trump on migrant child detentions, but Bill Clinton’s own record cuts deep
10 House Republicans Side with Democrats in Bid to Block Trump from Deporting Haitian Immigrants
Chuck Grassley, the longest-serving senator, hints at a ninth term
Federal agency approves Trump’s plan for triumphal arch ahead of America 250
FBI has received DNA data from Nancy Guthrie case: sources
Sailors injured after fire breaks out on aircraft carrier USS Eisenhower during shipyard maintenance
Missing general, scientist deaths tied to secret US work prompt White House probe
Illegal aliens are getting taxpayer-funded boob jobs and sex change ops in Newsom’s California, watchdog says
Eleven House Republicans vote to rebuke Trump and protect 350,000 Haitian migrants
China Northern rose as much as 9.3% in Shanghai, while Lynas Corp., the biggest producer of rare earth products outside China, added as much as 16% in Sydney. Hong Kong-listed China Rare Earth Holdings Ltd. spiked as much as 41% and has doubled in value in May.
China’s stranglehold is so strong that the U.S. joined with other nations earlier this decade in a World Trade Organization case to force the nation to export more amid a global shortage. The WTO ruled in favor of America, while prices eventually slumped as manufacturers turned to alternatives.
In December 2017, U.S. President Donald Trump signed an executive order to reduce the country’s dependence on external sources of critical minerals, including rare earths, which was aimed at reducing U.S. vulnerability to supply disruptions.
Story cited here.
