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U.S. President Donald Trump and Chinese President Xi Jinping. (Photo = Yonhap News) |
[Alpha Biz= Kim Jisun] Beijing, October 9 – China has announced a sweeping expansion of export controls on rare earth elements (REEs) and related materials, signaling a stronger grip on the supply of strategic minerals essential for semiconductors, electric vehicles, and defense technologies.
The move — unveiled weeks before the anticipated meeting between U.S. President Donald Trump and Chinese President Xi Jinping — is seen as a preemptive step in Beijing’s broader strategy to safeguard national security and technological sovereignty amid intensifying U.S.–China tensions.
Expanded List of Controlled Materials
According to a notice from China’s Ministry of Commerce (MOFCOM) on Wednesday, exports of several key rare earth metals and alloys will now require government-issued licenses for “dual-use” goods, meaning materials with both military and civilian applications.
The newly restricted items include samarium, dysprosium, gadolinium, terbium, lutetium, scandium, yttrium, and their alloys such as samarium–cobalt, terbium–iron, and dysprosium–iron. Oxides of dysprosium and terbium were also added to the list.
Crucially, MOFCOM extended these controls to rare earth magnets and target materials produced overseas using Chinese-origin rare earths or Chinese refining and metallurgical technologies. This effectively allows Beijing to assert regulatory reach over products made abroad that incorporate Chinese REEs.
AI and Advanced Semiconductor Materials Under Review
In a particularly sensitive measure, exports of REEs intended for semiconductors below 14 nanometers, 256-layer NAND flash memory, or related manufacturing and testing equipment will be subject to case-by-case review.
Rare earths used in artificial intelligence (AI) research and development with potential military applications will also face heightened scrutiny.
Security Justification and Strategic Context
A MOFCOM spokesperson said the decision aims to prevent “unauthorized overseas entities and individuals” from obtaining Chinese-origin materials that could be used in military or other sensitive sectors, citing “serious damage and potential threats to China’s national security and interests.”
The ministry emphasized that Beijing remains open to “dialogue and cooperation through multilateral and bilateral export control mechanisms” to ensure legitimate trade and safeguard the stability of global industrial and supply chains.
Global Impact
Analysts warn the expanded export controls could disrupt supply chains for electric vehicles, wind turbines, and high-end chips, where rare earth magnets and compounds are critical components.
South Korean and Japanese manufacturers — heavily dependent on Chinese REE imports — are expected to face renewed cost pressures and sourcing challenges.
The announcement underscores Beijing’s growing willingness to leverage its dominance in the global rare earth market, where it accounts for over 60% of global production and 85% of refining capacity, as a strategic policy tool.
알파경제 Kim Jisun (stockmk2020@alphabiz.co.kr)
