China's rare earth export curbs threaten $6.5 trillion of Western industry

The International Energy Agency warned that full implementation of China’s expanded rare‑earth export restrictions could jeopardise about $6.5 trillion of downstream production in the automotive, high‑tech, defence and energy sectors. The United States and Europe would account for roughly half of the economic impact. The agency also noted that planned export controls on graphite could put another $300 billion of production at risk, while China supplies more than 90 % of processed graphite.

IEA Executive Director Fatih Birol said the supply chains for critical minerals are highly concentrated and therefore vulnerable. Public financing for new projects has risen to $65 billion for 2023‑2025, and new rare‑earth refining projects in the United States and Malaysia have already cut China’s share of global processing from 90 % to 85 %. If planned projects stay on schedule, the share could fall to about 70 % by 2035. China has delayed the full rollout of the restrictions by a year after initially announcing them in October 2022.