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As the U.S.–China trade war heats up, Beijing just played one of its most powerful cards—halting exports of rare earth metals, a move that could send shockwaves through everything from EVs to missiles.
What are rare earths: there are 17 of them—not actually rare, but notoriously hard (and toxic) to mine. They’re essential in making magnets, semiconductors, EV motors, LED lights, and even AI chips and military hardware.
Most manufacturers don’t stockpile them.
And China controls the game. It produces over 99% of the world’s heavy rare earths and 90% of rare earth magnets. The U.S. once had a thriving domestic industry, but it faded in the ’80s as companies turned to cheaper Chinese sources.
Since 2020, the U.S. has pumped $439 million into rebuilding local supply chains, but it's nowhere near China’s scale yet.
Why it matters: this isn’t just a tariff tit-for-tat. Cutting off rare earth exports risks slowing down America’s EV sector, AI chip supply, and even military readiness. China also paused all Boeing aircraft deliveries, hitting the U.S.’s top exporter where it hurts.
Zoom out: with rare earths, China isn’t just reacting, it’s reminding the world that some supply chains are still dangerously one-sided.
