China recognized as the global leader in rare earth processing, has extended its export ban to encompass the technology essential for manufacturing rare earth magnets. This expansion supplements an existing restriction on technologies facilitating the extraction and separation of these critical materials.

Rare earths, comprising a group of 17 metals vital for producing magnets utilized in electric vehicles, wind turbines, and various electronics, have emerged as a focal point in geopolitical tensions.

China's commerce ministry has recently included technology for the preparation of samarium-cobalt magnets, neodymium-iron-boron magnets, and cerium magnets in its "Catalogue of Technologies Prohibited and Restricted from Export." This decision further solidifies China's control over strategic resources by extending the restriction to include technology related to rare-earth calcium oxyborate and production technology for rare earth metals.

Nathan Picarsic, co-founder of Horizon Advisory, a geopolitical consulting firm, underscores the importance of diversifying supply chains, highlighting that "dependence on China in any part of the value chain is not sustainable." This move by China raises concerns about the global supply chain dynamics and emphasizes the need for strategic considerations in managing critical resources.

China's intensified control over rare earth technology exports is part of a broader strategy aimed at securing dominance over critical minerals, raising concerns among Western nations. With China responsible for almost 90 percent of global refined output, the nation has implemented stricter export regulations for various metals throughout the year.

This poses a significant challenge for the West, especially as Europe and the United States seek to diminish reliance on Chinese rare earths. Attempts to establish alternative processing capabilities have encountered obstacles, with technical complexities and environmental concerns impeding progress.

The recent ban encompasses the extraction process, utilizing solvent extraction, a technique mastered by China and proving difficult for Western companies like MP Materials to effectively deploy. Following China's announcement, shares of MP Materials surged over 10 percent, underscoring the market's sensitivity to developments in the rare earth sector.

 While MP Materials, actively involved in rare earth processing in California, has not yet commented on the recent development, the market reaction highlights the impact of China's decisions on key industry players.

Ucore Rare Metals completes testing facility for its rare earth processing technology, partly funded by the US Department of Defense. CEO Pat Ryan highlights the need to counter China's dominance. Ucore's stock rises over 16%. Former Neo Performance Materials CEO notes China's historical discouragement of rare earth technology exports.

Karayannopoulos asserted, "This announcement simply confirms what has long been recognized," underscoring China's historical reluctance to share its rare earth technology with the global community.

Image source: NIKKI Asia