China has suspended exports of critical rare earth minerals and magnets, escalating its trade war with the United States in direct retaliation to President Donald Trump’s newly implemented 145% tariffs on Chinese imports.
The New York Times reported Sunday that the Chinese government halted exports while developing a new regulatory system that mandates special export licenses. These controls could effectively ban shipments to key American sectors, including defense contractors. China’s dominance in the rare earth supply chain—holding a monopoly on heavy rare earth metals and producing 90% of global rare earth magnets—makes the threat especially serious.
Of particular concern is the effect on national defense capabilities. James Litinsky, CEO of MP Materials Corp., emphasized that “drones and robotics are widely considered the future of warfare,” and warned that China is now shutting down access to the critical components needed for their development. These rare earths are essential to the production of missile systems, fighter jets, and high-tech military equipment.
The move follows China’s April 4 export restrictions on key elements such as samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. Just two days earlier, on April 2, Trump imposed the sweeping tariffs aimed at curbing China’s economic advantage. In response, China raised its tariffs on American goods to 125%, targeting key U.S. exports including soybeans and aircraft.
China’s export halt puts pressure not only on the U.S. defense industry but also on tech sectors that rely heavily on rare earths for smartphones, electric vehicles, and renewable energy technologies. The disruption could have lasting global repercussions, as the Chinese government has only begun implementing its new export regime, a process that may prolong shortages and further destabilize supply chains.
In response, the Trump administration is reportedly preparing an executive order to build a domestic stockpile of deep-sea metals and rare earth elements, seeking to reduce American dependency on foreign sources and protect national security interests.
