Now it’s time to see rare earths as power. China has done it

In April 2025, China imposed new export controls on seven rare earth elements and permanent magnets derived from them, the materials that form the basis of modern life and modern warfare. Fighter, missileelectric vehicles, drones, wind turbines and even data centers rely on high-performance magnets made from these critical minerals. By limiting its flow, Beijing not only bent its industrial muscles, but also revealed other dangerous vulnerabilities in the United States and the world. China’s latest action Demonstrate their ability to prepare and weaponize American and global dependence.

This is not a new challenge. The United States already knows that its key mineral supply chains are too concentrated, too fragile, and too susceptible to China’s leverage and control. However, in the Democratic and Republican administrations, we have failed to respond with urgency or coherence. Now, the consequences of these failures have left us in trouble and are stacked in our business and defense sectors.

Washington and Beijing announced Friday after talks in London A new trade framework During this period, China will resume approval of rare earth export licenses within the next six months. U.S. officials have publicly praised the breakthrough — but provide information about the rewards. This leaves the main question: What are the trade-offs in the United States? How to execute this transaction? What happens when the six months expire?

Skepticism is high. Ford recently stopped production at its Chicago plant due to a shortage of magnets – emphasizing that even short-term supply disruptions can have real consequences. Paper agreements are not supply chain solutions. Without transparency, timely approvals and long-term planning, this can easily become another diplomatic cycle forward, two steps backward.

Even this limited probation poses risks. Dozens of companies in Europe and North America have described it China’s export licensing procedures are highly invasive – Require the company to submit detailed production data, end-use applications, facility images, customer names and transaction history. Some applicants were rejected for not providing end user photos or documents.

The process is equivalent to “official information extraction,” executives said.

While companies are advised not to share sensitive IPs, omitting key details can mean indefinite delays. For companies in the defense supply chain, the impact is shocking: valuable business intelligence can be used to map competitors, disrupt pricing or raise Chinese alternatives.

It’s not just permission – it’s competitive surveillance. And, until the U.S. builds a secure, independent capability in critical mineral supply chains, it still faces risk of damage and data.

This vulnerability does not happen overnight. Many people have been watching this slow-motion train wreck for years. In 2010, China cut off rare earth exports to Japan in a maritime dispute, a clear warning shot that the United States observed but was rejected. In 2014, the Obama administration won a WTO case against China’s export restrictions, but mistakenly believed that the success of the law would prevent further manipulation.

What did Byton do Trump

The first Trump administration believes that a rare planet is crucial, but especially exempting them from China’s tariffs in 2018 is likely an unspoken recognition of U.S. dependence. Biden took the most structured approach to date: Executive Order 14017, Key Minerals Working Group, and IIJA and IRA funding. Strategic partnerships like the Mining Security Partnership emerged. But progress is slow, hindering progress by allowing delays and uneven ally promises.

The second Trump administration returned with more aggressive measures, invoking Article 232, activates the Defense Production Act, and proposes to propose large amounts of funding to promote it in fiscal 2026. The National Energy Steering Committee is now coordinating its efforts. However, these measures, like China’s six-month probation, still haven’t driven Beijing’s grip. Crucially, the defense sector is still cut off and no such license window is available.

The recent G7 summit in Canada highlighted global bets. European Commission President Ursula von der Leyen Directly accuse China of “weaponization” its control On key materials such as rare earths, a joint G7 response is required. result: G7 Key Mineral Action Plan. Although China is not mentioned, the subtext is clear. The program promises to increase the traceability standards of ESG and key resources; mobilize capital in critical mineral mining and processing; and collaborate on recycling, substitution and refining technologies.

Foreseeable, Beijing reacted with anger. The Chinese Foreign Ministry dismissed the plan as an “excusation” of protectionism, claiming that the G7 incited confrontation out of fear of losing market share.

Brussels now shows that trade talks with Beijing have effectively stalled, so the odds of China’s retaliation, especially against the EU, are rising. If China doubles, it could push the EU, Japan, South Korea and India more closely toward Washington’s track, which is exactly what Beijing hopes to avoid.

China’s dominance in rare earth mining

The original numbers are amazing. China accounts for about 70% of global rare earth mining, but exceeds 90% of its refining capacity. It produces 92% of the world’s media iron – iron (NDFEB) magnets – used in all food products from submarines to Teslas. This kind of rule is by no means accidental. The processing of subsidies in China focuses on global acquisitions of supply chains and is much faster than the West can approve and issue licenses for individual mines.

Our website likes MP Materials‘Mountain Pass and Round Top are still incomplete without downstream processing. The Department of Defense and Energy provided grants, and the Trump budget for fiscal 2026 is designed to expand our mining capacity and ensure access to critical minerals. However, all this is still inferior to the industry’s long-term industrial command and control.

China entered Africa and Latin America early and decisively, working with the governments of the Democratic Republic of the Congo, Bolivia and Chile; investing in ports, railroad tracks and refining infrastructure. Instead, the U.S. efforts and engagement in these problem sets are fragmented and valued, prioritizing transparency and governance, which is indeed important, but has created limited momentum on key mineral issues. Even recently Must with Ukraine and the Democratic Republic of the Congo still exists symbolic and is hampered by conflict and instability in these countries.

The talks in London and the recent trade deal took time. But time without strategy is not fruitful. China’s licensing system remains intact and its data requirements have not weakened. The defense sector is still turned away. Meanwhile, Congress threatening to withdraw funds for clean energy and industrial policy could put rare earth projects in trouble.

This is a decisive moment. China dares to say that the internal division of the United States – between labor, industry, environmentalists, tribal states and political factions, will prevent competition from the unity required by continued efforts. They may be right. The United States needs to prove that they are wrong.

Key minerals are geopolitical forces

Now, the United States must see critical minerals as commodities, but rather as tools of geopolitical power. China has done it. Escape from its grip will require more than mine permits and short-term funds. It requires a coherent long-term strategy to build a complete supply chain that includes not only domestic capabilities but also reliable allies and partners. From mining and improvement to magnet production and recycling, each link must be strengthened through targeted investments that allow reform and strategic coordination.

Successful and sustainable policies require commitment from one president to the next. Nor can the United States interact with allies and partners in just words. Countries such as the Democratic Republic of the Congo, Chile and Indonesia (etc.) need ongoing partnerships supported by financing, technology transfer and investment in critical infrastructure, not just our lectures on governance.

A six-month export probation from China is not the solution – it is a stress test. It reveals whether America can eventually focus and act, or whether it will retreat to complacency again. Beijing is betting that this will be the latter. Washington must respond with a sense of urgency, unity and a strategy that equals the challenge scale. There is still time, but not much.

–go through Dewardric McNealManaging Director and Senior Policy Analyst at Longview Global and CNBC Contributor