Chinese exporters of some rare earths have rerouted their flows to skirt a ban on selling these commodities to the U.S., and now they enter the country from Thailand and Mexico, Reuters has reported, citing customs and shipping records.
According to the records, while Chinese exports of antimony, a critical mineral that is used in batteries and microchips, to the United States had stopped since December last year, exports of the mineral to Thailand and Mexico had surged. Both of these countries became top-three importers of Chinese antimony, Reuters noted in its report.
In turn, U.S. imports of minerals from Thailand and Mexico since December last year surged, with the total for December to April at 3,834 tons. This was almost as much as total antimony imports from those two countries for the previous three years combined, Reuters said.
China, which dominates the global rare earth and critical minerals supply chain, announced earlier this year 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.
The announcement caused panic in the automotive industry, which is a heavy user of these rare earths, with companies warning that they will have to start suspending production in case of shortages. It did not come to that, however, after the U.S. reached a trade agreement with China that involved the latter removing the export curbs that had exporters having to apply for special licenses to sell critical minerals abroad. It seems, however, that this agreement does not cover antimony, gallium, and germanium—the rare earth elements the U.S. has been importing in bulk from Thailand and Mexico.
By Irina Slav for Oilprice.com
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