China saw its shipments of rare earth magnets to foreign markets crash by 53% in May to the lowest level for any month since February 2020, according to data from the General Administration of Customs cited by Reuters.
At the beginning of April, China announced it would curb its exports of dysprosium, gadolinium, scandium, terbium, samarium, yttrium, and lutetium. These so-called “heavy” and “medium” rare earth elements are mostly used in automotive applications, including rotors and motors and transmission in electric vehicles and hybrids, as well as in the defense industry in parts of jets, missiles, and drones.
China also imposed restrictions on exports of some magnets.
As a result, the shipments in May slumped by 52.9% compared to April and by 74% compared to May 2024.
Earlier this week, China eased some restrictions on exports of rare earth elements by approving “a certain number” of export licenses, its commerce ministry said on Thursday in what could be the beginning of eased access to rare earths for the global supply chains.
“China will continue to strengthen the approval process for compliant applications, and is willing to further enhance communication and dialogue with relevant countries on export controls,” He Yadong, a spokesperson for the commerce ministry said at a news conference, as carried by Reuters.
The Chinese export restrictions reverberated through global supply chains and were initially felt in the automotive industry, where major car manufacturing associations warned that production and assembly lines are being idled due to a bottleneck in magnet and rare earth supply.
Last week, U.S. President Donald Trump said that China would supply full magnets and “any necessary rare earths” upfront to the United States in a deal that is “done” and subject to final approval by the presidents of the two countries.
President Trump’s post on Truth Social last week came hours after officials from both countries had said that the U.S. and China had reached a framework agreement that could pave the way to China lifting its export curbs on rare earth elements.
By Tsvetana Paraskova for Oilprice.com
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