China has now imposed export controls on a range of critical rare earth minerals and magnets, dealing a major blow to the US.

The move has laid bare how reliant America is on these minerals.

Unlike tariffs, it’s a front where Trump has little room to retaliate in kind.

和關稅不同，在稀土領域，特朗普幾無反擊空間。

As China imposes export controls on rare earth elements, the US would be unable to fill a potential shortfall, according to the Center for Strategic and International Studies (CSIS) — and this could threaten Washington's military capabilities.

"Rare earths" are a group of 17 chemically similar elements that are crucial to the manufacture of many high-tech products.

Most are abundant in nature, but they are known as "rare" because it is very unusual to find them in a pure form, and they are very hazardous to extract.

In 2023, China produced 61% of the world's raw magnet rare earth elements, which are essential in high-tech industries such as electronics, electric vehicles and defense.

Its dominance is even more pronounced in refining these materials, making up 92% of the global refined supply.

Between 2020 and 2023, the US relied on China for 70% of its imports of all rare earth compounds and metals, according to a US Geological Survey report this year.

According to the CSIS, this leaves the US particularly vulnerable as there is no capacity outside China to process heavy rare earths.

Heavy rare earths are used in many military fields such as missiles, radar, and permanent magnets.

A CSIS report notes that defence technologies including F-35 jets, Tomahawk missiles and Predator unmanned aerial vehicles all depend on these minerals.

According to CSIS' report, if China's trade controls result in a complete shutdown of the medium and heavy rare earth element exports, the US will be incapable of filling the gap.

The CSIS report cites an estimate that China is acquiring advanced weapons systems and equipment five to six times faster than the US, originating from a US Air Force official in 2022.  

"Further bans on critical minerals inputs will only widen the gap, enabling China to strengthen its military capabilities more quickly than the United States," the report concludes.

"Manufacturers, particularly in defence and high-tech, face potential shortages and production delays due to halted shipments and limited inventories," said Gavin Harper, a critical materials research fellow at the University of Birmingham.

"Prices for critical rare earth materials are expected to surge, increasing the immediate costs of components used in a wide range of products, from smartphones to military hardware," he says, adding that this could result in potential production slowdowns for affected US companies.

The US has one operational rare earths mine, but it does not have the capacity to separate heavy rare earths and has to send its ore to China for processing.

Since the first Trump administration, the US has been trying to play catch-up and build up its own domestic rare earths supply chain. 

But those efforts will take years to meet the enormous demand from key US industries.

This is largely believed to be part of why US President Donald Trump is so keen to sign a minerals deal with Ukraine – it wants to reduce dependency on China.

Another place Trump has had his eye on is Greenland — which is endowed with the eighth largest reserves of rare earth elements.

However, questions remain about the value and accessibility of such deposits.

"It's China showing that it can exert incredible economic might by being strategic … and surgical and really hitting American industry right where it hurts," said Justin Wolfers, a professor of economics and public policy at the University of Michigan.

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