China's rare earth export controls trigger trade tensions with EU and United States

China, which supplies about 90 % of light rare earths and over 98 % of heavy rare earths, has added U.S. firms MP Materials Corp. and USA Rare Earth Inc. to its export control list, banning the shipment of certain rare‑earth metals to them. The move heightens concerns about supply chain security for electric vehicles, renewable energy, defense and advanced technology products.

European leaders are also alarmed by a surge of Chinese exports that they say threaten domestic industries. French President Emmanuel Macron and other officials have called for EU powers similar to the U.S. Section 301 to impose protective tariffs on China, with backing from Germany, Poland, the Netherlands, Belgium and a joint paper from France, Italy, the Netherlands and Lithuania urging new measures to curb reliance on a single supplier.

Both the United States and the European Union have been pushing to diversify critical‑mineral supply chains. At the recent G7 summit, leaders pledged to limit any single country’s share of rare‑earth imports to no more than 60 % by 2030. China’s latest restrictions, however, risk reigniting trade friction and could lead to further tariff actions or other protective steps by the EU and the United States.