Following President Trump's announcement in early April of reciprocal tariffs on global imports, China swiftly implemented export control measures as a retaliatory response to the United States' imposition of punitive tariffs on Chinese goods. In particular, the export controls on rare earth products demonstrate that China's actions are not merely rhetoric but are being translated into concrete measures. Based on May's export data, China's stance on rare earth exports is extremely firm, yielding significant results.
According to data released by China's customs on June 20, rare earth exports plummeted in May to just 1,238 tons, a 52.9% decline from April. This figure marks the lowest level since February 2020, far below March's export volume, and represents a staggering 74% year-on-year decline. Meanwhile, the total value of rare earth exports also hit a new low, totaling just $60 million, marking the worst month since 2015 (excluding the period during the COVID-19 outbreak in February 2020).
China's rare earth exports to the US plummeted by 80% in May
Notably, China's rare earth exports to the United States plummeted by 80% in May, totaling only 46 tons. As a key market for global high-tech and military industries, the United States relies heavily on rare earth resources. The significant reduction in exports has undoubtedly exacerbated supply pressures in these sectors.
Japan has also been affected by export controls. As a major global hub for electronics manufacturing, Japan's rare earth imports also plummeted by 54% in May. Rare earths are essential materials for many high-tech manufacturing industries, and this supply shortage could impact Japan's manufacturing sector and supply chains.
Overall, China's rare earth export restrictions have not only caused significant disruption to the United States but have also had a notable impact on other global economies, particularly industrial powerhouses heavily reliant on rare earths. This move is likely to have far-reaching implications for international trade and global supply chains.
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