The latest controls for exporting China threaten rare ground minerals to stop cars, as basic magnet stocks are expected to be dedicated within months if Beijing completely stops its exports, according to the Financial Times in a report.
Beijing expanded its export restrictions to 7 rare ground elements and vital magnets for electric cars, wind turbines and combat aircraft in early April, in response to the high tariffs imposed by US President Donald Trump on China by 145%.
Store materials
Government officials, merchants and executive managers in car companies said that with an estimate that the stocks will suffice between 3 and 6 months, companies will accelerate to store more materials and find alternative supplies to avoid major disturbances.
https://www.youtube.com/watch?v=elhqgioetic
Jean -Jezi, a mineral dealer at the Frankfurt -based Tradium Company, Germany, noted that the customers were surprised, and it seems that most of the car companies and their suppliers keep only enough magnets for two months to 3 months.
Jezi told the British newspaper that if magnet shipments are not received to the European Union or Japan during that period, or at least close to it, real problems will occur in the car supply chain.
The latest Chinese controls focused on rare “heavy” and “medium” ground minerals that enable the production of high -performance magnets capable of bearing high temperatures, such as dessprosium, turbium and namarium, and these minerals are vital for military industries such as jet aircraft, missiles and drones, in addition to engines and movement carriers that are frequently used in electric vehicles and hybrids.
The newspaper quoted an executive official who described it as the great in the automotive sector as saying that the difficult restrictions on the minerals will be “severe consequences” on Tesla and all other car manufacturers, describing the export controls as “7 or 8” on a scale from 1 to 10 in terms of intensity.
revenge
He added that it was a form of “revenge” as the Chinese government can say: “Well, we will not like the same about the customs tariff, but we will hurt you, America, and we will motivate companies to appeal to the governments of their countries to change the policy of customs tariffs,” he said.
The rare ground minerals are commonly found in the Earth’s crust, but it is difficult to extract at a low cost and in an environmentally friendly manner, and China almost monopolizes the treatment of rare heavy ground minerals.
Cori Combs of the Beijing Consulting Company, based in Beijing, said that rare “light” ground minerals, such as nodimum and baciodimium, used in larger quantities in the magnet, were not targeted, giving Beijing a “great threat” to expand the scope of controls if the trade war intensified.
Beijing’s controls from exporters require licenses for each shipment of materials abroad, and has expanded its scope to a re -export prohibition to the United States, however, the application of restrictions that included a gradual growing group of basic minerals since 2023 in response to the American ban on China’s arrival to chip technology was not comprehensive.
Chinese exporters have already announced the case of force majeure on rare ground mineral shipments and magnets heading abroad, and withdrew materials designated for sale from the market, which increased the ambiguity of the prices of goods that are already ambiguous.
Hope
Japan and other countries are attached to its hopes for alleviating China’s fist on rare heavy ground minerals through the Australian company Lynas, which is scheduled to expand its Malaysian site for treatment to produce dessprosium and turbium by mid 2025, according to the newspaper.
A Japanese government official said that the heavy rare ground mineral stocks are not sufficient to avoid possible disturbances in car supply chains, and that national stocks would provide additional support exceeding two months to 3 months of supplies maintained by car manufacturers.
https://www.youtube.com/watch?v=qvnhkqmr-_A
He added: “The issue lies in the extent of our ability to build a new alternative supply chain in time for our stockpile of steadfastness in the face of this crisis.”
It has not been clear from the advertisements of Chinese government since April 2, how Beijing plans to implement the latest export controls.
Analysts said the export controls come at a time when China is facing a decrease in raw materials for rare heavy ground minerals due to the NGOs in Myanmar, which means that the prohibition of exports would support local supplies.
They pointed out that, over the past years, China has been reluctant to prevent shipments that would harm its economic interests, such as Galium, while other mineral shipments such as Antimon, used in the lead industry, were very prohibited.
“The decisive question is how long it will take to process export licenses,” Jizi said.
