Economic Warfare & Trade Policy Tech & export controls
Photo: Rare-earth oxides; clockwise from top center, praseodymium, cerium, lanthanum, neodymium, samarium and gadolinium. Peggy Greb, U.S. Department of Agriculture, public domain, via Wikimedia Commons.
China’s critical-mineral export controls have become Beijing’s most direct form of economic leverage over the United States and its allies. Since 2023 China’s commerce ministry, MOFCOM, has put gallium, germanium, graphite, antimony, tungsten and seven heavy rare earths under export licensing, banned some shipments to U.S. military users, and drafted wider rules that are now suspended as part of a truce with Washington. This investigation sets out what is in force, what is paused, how the lever works, and what U.S. government data show about the exposure.
Labels used in this report: Verified fact Official claim Expert interpretation Estimate Forecast
Executive summary
- China’s leverage comes from licensing, not outright bans: exports continue, but each shipment of a controlled item needs MOFCOM approval and an end-user certificate.
- The April 2025 controls on seven heavy rare earths were never suspended. The broader October 2025 package is paused only until Nov. 10, 2026, and a U.S.-specific ban on gallium, germanium and antimony is paused until Nov. 27.
- U.S. Geological Survey data show the United States imported every gram of the gallium and natural graphite it used in 2025, and that China dominates world output of several controlled minerals.
- Measured effects so far are price spikes and shifting import sources rather than shortages, according to USGS commodity reports.
Timeline
- August 2023: China introduces export licensing for gallium and germanium. Verified fact (USGS)
- Dec. 1, 2024: Controlled minerals move into a single Dual-Use Items Export Control List (MOFCOM Announcement No. 51 of 2024).
- Dec. 3, 2024: Announcement No. 46 bans dual-use exports to U.S. military end users and sets a presumption of denial for gallium, germanium, antimony and superhard materials bound for the United States.
- Feb. 4, 2025: Tungsten, tellurium, bismuth, molybdenum and indium items are added (No. 10).
- April 4, 2025: Licensing for samarium, gadolinium, terbium, dysprosium, lutetium, scandium and yttrium (No. 18).
- Oct. 9, 2025: China extends controls to foreign-made goods containing Chinese rare earths and to rare-earth technology (Nos. 61 and 62).
- November 2025: After the Busan summit, China suspends the October measures until Nov. 10, 2026, and the U.S.-specific clause until Nov. 27, 2026.
- Sept. 28, 2026: MOFCOM says the underlying U.S.-China arrangement is extended to Jan. 10, 2027. No numbered notice amending the suspension had appeared by mid-October, according to a review of MOFCOM’s announcement list by China Prospect.
The policy, explained
Under State Council Decree No. 792, the Chinese exporter, not the foreign buyer, applies to MOFCOM for a license. The buyer must supply an end-user and end-use certificate, and may not change the use or pass the items on without permission. MOFCOM has 45 working days to decide once it accepts an application, but time for expert review or site checks does not count, and the ministry publishes no typical approval time. A single license covers one export to one end user for up to a year; a general license can cover repeated exports for up to three years. Verified fact (summarized by China Prospect from the decree and MOFCOM texts) USGS reports that China began issuing general licenses for rare earths to selected exporters after the November 2025 suspension.
Affected countries
Licensing applies to every destination, so Japan, South Korea, the European Union and other buyers are covered as well as the United States. The U.S.-specific clause, when in force, singles out American buyers. Announcement No. 61, the suspended extraterritorial rule, would have required companies outside China to obtain a Chinese license to ship certain goods between two other countries if they contained 0.1% or more Chinese-origin rare-earth content by value. Verified fact
Economic mechanisms
The lever works through concentration at the processing stage. A buyer whose supply chain runs through Chinese refiners or magnet makers cannot easily switch, because alternative refining capacity takes years to build. Licensing delays raise inventory costs and push buyers to stockpile, which lifts prices outside China. Our earlier explainer on the rare-earth truce and the Jan. 10 deadline describes analysts’ view that leverage sits in refining and magnet production rather than mining. Expert interpretation
Relevant statistics
| Mineral | U.S. net import reliance, 2025 | China share of world production |
|---|---|---|
| Gallium | 100% | 99% of primary low-purity output |
| Graphite (natural) | 100% | 78% (1.40 million of 1.80 million t) |
| Antimony | 91% | 36% (40,000 of 110,000 t, estimate) |
| Tungsten | more than 50% | 79% (67,000 of 85,000 t) |
| Rare earths (compounds and metals) | 67% | 69% of mine output (270,000 of 390,000 t) |
Verified fact for reliance figures; shares are Estimate calculated by The Boston Report from USGS country tables (USGS, MCS 2026). Mining shares understate China’s role in refining. More series are on the data dashboard.
Stakeholder impacts
U.S. manufacturers paid more. USGS reports the average antimony price nearly doubled from $9.80 a pound in August 2024 to $18.10 in December 2024, after China’s August restrictions and December U.S. ban, and averaged $25 in 2025. Rotterdam prices for tungsten concentrate rose from $266 to $551 per metric ton unit during 2025; USGS links the rise to U.S. tariff increases and China’s February controls. Official claim (USGS interpretation) Importers of germanium switched forms: U.S. imports of germanium metal fell 67% in 2025 to about 7,000 kilograms, which USGS attributes to China’s ban, while germanium dioxide imports rose 55%. Gallium buyers paid about 30% more per kilogram in 2025, even as imports more than doubled. Verified fact
Geopolitical objectives
The controls are issued under China’s dual-use export-control framework, State Council Decree No. 792, which ties licensing to end-use review. The sequence of events also shows them used in bargaining: the October 2025 package was suspended in exchange for the U.S. suspending its Entity List “affiliates rule,” according to the Bloomsbury Intelligence and Security Institute, and MOFCOM tied the suspension to the same trade arrangement in April 2026. Analysts cited in our truce explainer describe China retaining “substantial influence over supply” whatever happens in January. Expert interpretation
Policy effectiveness
Judged as leverage, the controls produced a negotiated result: Washington paused a significant export-control rule, a concession documented in the Federal Register. Judged by the stated security goal, there is no public evidence either way on whether licensing kept controlled items from military users. Judged by market outcomes, they raised prices and diverted trade but did not halt it: U.S. gallium imports rose in 2025 and, according to USGS, China lifted its gallium ban on the United States for one year in November 2025.
Unintended consequences
The controls accelerated efforts to replace Chinese supply. USGS lists new gallium projects in Australia, Canada, Greece, Kazakhstan and South Korea, a $29.9 million Defense Production Act Title III award in November 2025 noted in its gallium chapter, and Defense Production Act awards for tungsten projects in Nevada, New Brunswick and Yukon. U.S. policy also moved: a Section 232 investigation into processed critical minerals ended in January 2026 with the President directing negotiations rather than tariffs, according to the Congressional Research Service. Whether these projects reach commercial scale is not yet known.
Future scenarios
- Legal extension: MOFCOM publishes a notice extending the suspension to Jan. 10, 2027 in early November, matching its September statement.
- Lapse: without a notice, the October 2025 measures return on Nov. 10, including the extraterritorial rule, and the U.S.-specific ban returns on Nov. 27.
- Managed licensing: the April 2025 rare-earth licensing continues regardless, with more general licenses for approved buyers. Analysts quoted in our earlier coverage call another extension or limited compromise the base case for January. Forecast
Additional details
China’s Ministry of Finance is also cutting the export VAT rebate on batteries from 9% to 6% for April to December 2026 and abolishing it from Jan. 1, 2027; that is a tax change, not an export control. USGS notes that in October 2025 China expanded rare-earth controls to europium, holmium, erbium, thulium and ytterbium, the part now suspended. The U.S. government’s fiscal 2025 stockpile plan listed potential acquisitions of 450 tons of neodymium-iron-boron magnet block. For the trade side of the truce, see our report on the U.S.-China 30-for-30 tariff framework.
Sources
- U.S. Geological Survey: Mineral Commodity Summaries 2026 (version 1.3, May 2026)
- China Prospect: China’s export controls on rare earths and battery materials, with MOFCOM announcement numbers
- Federal Register: One-year suspension of the BIS Affiliates Rule (Nov. 12, 2025)
- Congressional Research Service: Active Presidential Tariff Actions in 2026 (Section 232 processed critical minerals)
- The Boston Report: Rare earth truce explained
Read next in Global Supply Chains & Dependencies
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