China has been signalling that it may restrict the export of rare earth minerals to the United States as the trade conflict between the two countries escalates.
It is by far the largest producer of these raw materials, vital for many American industries including high-growth sectors such as electric car and wind turbine production.
Last year, the US Geological Survey designated these minerals critical to the economy and national defence.
“China is seriously considering restricting rare earth exports to the US,” tweeted the editor of Chinese state-run Global Times this week.
What are rare earth minerals?
Rare earth minerals are a group of 17 elements used in production in a huge number of sectors, including renewable energy technology, oil refinery, electronics, and the glass industry.
Although called “rare”, they are actually found relatively abundantly in the Earth’s crust, according to the US Geological Survey.
However, there are relatively few places in the world that mine or produce them.
Extraction is both difficult and potentially damaging to the environment.
Chinese mines account for around 70% of global output.
Myanmar, Australia, and the United States plus a few other countries which mine only small amounts, account for the rest.
China’s dominance of rare earth mining
Yearly mine production (tonnes)
In the refining of rare earth ores, China is even more dominant.
Last year, almost 90% of all the processing into usable oxides was done in China.
An Australian company operating in Malaysia produces almost all the rest.
Over the past five years, China’s exports of rare earth oxides have almost doubled, according to official Chinese statistics.
How reliant on China is the US?
Around 80% of the rare earths imported by the United States comes from China, according to US government data.
Estonia, France and Japan also supply processed rare earths to the US, but the original ore comes from China.
The one rare earth mine operating in the United States sends its ore to China for processing – and already faces a 25% import tariff imposed by China.
There is an option for the US to import from Malaysia, but not in the quantities required.
Also, the Malaysian government has threatened to discontinue production because of environmental concerns.