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Today's Topics:
1. China doesn't need to export rare earths ? it's running out
at home (Stephen Loosley)
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Message: 1
Date: Sun, 30 Nov 2025 00:57:06 +1030
From: Stephen Loosley <[email protected]>
To: "link" <[email protected]>
Subject: [LINK] China doesn't need to export rare earths ? it's
running out at home
Message-ID: <[email protected]>
Content-Type: text/plain; charset="UTF-8"
China doesn't need to export rare earths ? it's running out at home
By Stephen Chen, SCMP <[email protected]> Nov 1, 2025, 12:33?PM
Reply-To: [email protected]
China doesn't need to export rare earths ? it's running out at home
A while back, I ran into a neighbour in the lift ? an accomplished PhD holder
from the Chinese Academy of Sciences who has spent more than two decades
working in the rare earth industry.
When I asked him whether China?s recent strict export controls on rare earths
had affected his business, he smiled and said, ?Not at all.? Surprised, I asked
why. His answer was simple:
?Domestic demand already outstrips supply.?
That single sentence cuts straight to the heart of one of the most
consequential industrial shifts of our time, no 100-page policy report required.
The prevailing narrative is that China?s rare earth export restrictions are a
retaliatory move against US trade policies, particularly those initiated during
the Trump administration.
But the truth is far more structural and less reactive: China likely had to
restrict exports regardless of geopolitical tensions. The US tariff threats
merely provided a convenient excuse.
China is running out of spare capacity in its rare earth and critical mineral
supply chains ? especially rare earth elements gallium, and germanium. These
materials are the invisible backbone of the modern technological world.
Consider this: China would likely account for nearly 70 per cent of global
electric vehicle (EV) production this year and these cars are growing on
Chinese roads faster than anywhere else on Earth.
And each of these intelligent, sensor-packed models ? equipped with lidar,
precision motors and AI-driven systems ? consumes lots of rare earths,
particularly neodymium and dysprosium for high-performance permanent magnets.
Meanwhile, solar and wind farms are being erected at breakneck speed across the
country. A single offshore wind farm can require more rare earths than what
some other countries produce in a year.
Add to that the explosive growth of AI data centres, semiconductor fabs and
satellite manufacturing facilities ? all competing for the same finite pool of
critical minerals.
And this is just the beginning.
China?s recently released draft of its 15th five-year plan outlines a future
where demand for rare earths will skyrocket.
By 2030s, humanoid robots could enter millions of Chinese households.
Experimental nuclear fusion reactors are expected to achieve sustained
ignition. Next-generation defence systems ? capable of operating across land,
sea, air and space ? are being rapidly deployed. Autonomous vehicles, some
capable of flight or navigating waterways like boats, are already in
development by Chinese automakers.
Two decades ago, China attempted to impose rare earth export controls, but the
policy faltered. At the time, most hi-tech manufacturing was still concentrated
overseas ? particularly in the US, Japan and Europe. Restricting exports meant
hurting China's own demand for these hi-tech products.
Today, the situation is reversed. China now hosts the world?s largest ecosystem
of rare earth-dependent industries ? from consumer electronics and EVs to
renewable energy and advanced defence systems.
The domestic market and industrial base have achieved a powerful
self-sustaining loop.
In this new reality, export controls aren?t an aggressive geopolitical lever ?
they?re a rational industrial policy. By prioritising domestic access to
critical materials, China ensures that its manufacturers and consumers continue
to enjoy the world?s most affordable hi-tech products ? from EVs to smartphones
to home robots.
Ironically, the group that may benefit most from restricted rare earth exports
isn?t China?s political elite in Beijing ? it?s the ordinary Chinese family
that can now buy a cutting-edge electric car for less than US$10,000, or a
smart device packed with advanced sensors at unbeatable prices.
If China were to satisfy the factories in the US with raw rare earths, it would
inevitably drive up domestic production costs, raising prices of everything
from phones to green energy infrastructure. So while the world debates
geopolitical strategy, the real story is not about China controlling exports.
It?s about securing a technological future.
Cheers,
Stephen
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