It’s time for U.S. to treat rare earths as power. China already does

In April 2025, China imposed new export controls on seven elements of rare land and permanent magnets that derive from it – materials that form the foundation of modern life and modern war. Hunting jets, missilesElectric vehicles, drones, wind turbines and even data centers are based on high performance magnets made from these critical minerals. By restricting their flow, Beijing has not only flexed its industrial muscle, he revealed that America and the rest of the dangerous vulnerability of the world. China’s latest actions Show their preparation and their ability to arm American and global dependence.

This is not a new challenge. The United States has known for over 15 years that its critical mineral supply chains were too concentrated, too fragile and too exposed to the Chinese lever and control effect. And yet, in democratic and republican administrations, we did not respond with urgency or consistency. Now the consequences of these failures have attracted us by the neck and are in cascade in our commercial and defense sectors.

After London discussions, Washington and Beijing announced on Friday A new commercial framework Under which China will resume approval from the export licenses for rare land in the next six months. US officials have publicly praised the breakthrough – but offered few details on what was given in return. This leaves unanswered questions: what were the American compromises? How will the agreement be applied? And what happens when the six months are in place?

Skepticism is high. Ford recently interrupted production in its Chicago factory due to a shortage of magnets – stressing that even short -term supply interruptions have real consequences. Paper agreements are not supply chain solutions. Without transparency, apparent in time and long -term planning, this could easily become another diplomatic cycle in a step forward, a stone’s throw back.

Even this limited reproduction has risks. Dozens of companies in Europe and North America have described The China export license process is very invasive – Oblige companies to subject detailed production data, final use applications, facilitated images, customer names and transaction stories. Some candidates have been refused for not having provided photographs or documentation of their end users.

Managers claim that the process is equivalent to “official extraction of information”.

Although companies are not informed not to share sensitive intellectual property, the omission of key details can mean indefinite delays. For companies in defense supply chains, the implications are alarming: valuable commercial information could be used to map competitors, disrupt prices or advance Chinese substitutes.

It is not only a license – it is competitive monitoring. And until the United States strengthens independent and safe capacity through the critical mineral supply chain, it remains exposed both to the disruption and the risk of data.

This vulnerability did not occur overnight. Many have been looking at this train wreck in slow motion for years. In 2010, China cut exports from rare earths to Japan during a maritime dispute, a clear warning observed the United States, but collapsed. In 2014, the Obama administration won an WTO file against China export restrictions, but wrongly assumed that legal success would dissuade additional manipulation.

What Trump, Biden did

The first Trump administration identified rare earths as criticism, but notably exempted them from the Chinese prices of 2018, perhaps a tacit recognition of American dependence. Biden has adopted the most structured approach to date: executive order 14017, the working group on critical minerals and the financing of iija and IRA. Strategic partnerships such as the mineral security partnership have emerged. But progress has been slow, hampered by authorizing the delays and unequal allied commitments.

The second Trump administration returned with more aggressive measures, invoking article 232, activating the Defense Production Act and offering major funding increases during the 2010 financial year. A National Energy Domination Council now coordinates efforts. However, these measures, like the six -month suspended from China, are still unable to dislodge Beijing’s grip. And above all, the defense sector remains cut, without such a license window available.

The recent G7 summit in Canada highlighted the global issues. The president of the European Commission Ursula von der Leyen Directly accused China of “armaments” its control On key materials like rare earths, calling for a United G7 response. The result: a Critical mineral action plan G7. Although China was not mentioned by its name, the subtext was undoubtedly. The plan commits G7 members to raise ESG standards and traceability for key resources; Mobilize capital for new projects in the extraction and treatment of critical minerals; And cooperate on innovation in recycling, substitution and refining technologies.

As you would expect, Beijing reacted with the fury. The Chinese Foreign Ministry rejected the plan as a “pretext” for protectionism, claiming that the G7 provoked confrontation for fear of losing market share.

Brussels now indicates that trade negotiations with Beijing are actually blocked, so that the chances of Chinese reprisals – in particular against the EU – increase. If China is doubled, it may push the EU, Japan, South Korea and India more closely in the Washington orbit – precisely what Beijing hopes to avoid.

The dominant position of China in the exploitation of rare land

The raw numbers are astounding. China represents around 70% of the global exploitation of rare land, but more than 90% of refining capacity. It produces 92% of neodymium-fer-boron (NDFEB) magnets in the world-used in everything, teslas submarines. This domination is not an accident. China has subsidized treatment, focused on global acquisitions through the supply chain, and increases production much faster than the West cannot approve and make permits for a single mine.

Americans of sites like MP materials“The mountain pass and the top round remain incomplete without downstream treatment. The DOD and the DOE offered subsidies, and the Trump budget for the 2010 financial year seeks to extend American mining capacity and guarantee access to critical minerals. But all of this remains overshadowed by the start of China and the long -standing industrial command in the sector.

China moved early and decisively in Africa and Latin America, in partnership with governments of the Democratic Republic of Congo, Bolivia and Chile; Invest in ports, rails and refining infrastructure. On the other hand, the efforts and commitment of the United States on these sets of problems have been fragmentary and values ​​before, prioritizing transparency and governance, important questions, but offering a limited dynamic of critical mineral problems. Even recent submarines with Ukraine and the Democratic Republic of Congo remain symbolic for the moment, hampered by conflicts and instability in these countries.

London talks and recent progress in the trade agreement bought time. But time without strategy is not fruitful. The China’s license regime remains intact, its data requires tirelessly. The defense sector remains excluded. Meanwhile, threats from the congress to cancel clean energies and the financing of industrial policies could block rare land projects when they gain ground.

It’s a decisive moment. China bets that the internal divisions of America – between work, industry, environmentalists, tribal nations and political factions – will prevent the type of unified and supported effort necessary to compete. They may be right. The United States must prove it evil.

Critical minerals are geopolitical power

The United States must now treat critical minerals not as basic products, but as geopolitical power instruments. China is already doing so. The exhaust of its grip will require more than mining permits and short -term financing. It requires a long -term coherent strategy to build a complete supply chain which not only includes interior capacity but also reliable allies and partners. From mining and refining to the production and recycling of magnets, each link must be reinforced thanks to targeted investments, permit reform and strategic coordination.

A successful and sustainable policy requires the commitment of one presidency to another. The United States cannot afford to hire allies and partners only rhetorically. Countries such as the Democratic Republic of Congo, Chile and Indonesia (among others) need partnerships supported by financing, technology transfer and critical infrastructure investments, not just our conferences on governance.

The six -month export of China export is not a solution – it is a constraint test. It reveals whether the United States can finally concentrate and act, or if it will retrieve itself in complacency. Beijing bet it will be the latter. Washington must respond with urgency, unit and a strategy equal to the scale of the challenge. There is still time, but not much.

–By McNeal DEWARDRICManaging Director and analyst of senior policies at LongVIEW GLOBAL, and a CNBC contributor