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China Grants Limited Licenses for Rare Earth Exports After Magnet Shipments Fall 75%

A mandatory tracking regime is in place to oversee magnet shipments after global automakers halted production

Workers transport soil containing rare earth elements for export at a port in Lianyungang, Jiangsu province, China October 31, 2010. Picture taken October 31, 2010. REUTERS/Stringer/File Photo

Overview

  • April export curbs slashed China’s magnet shipments by about 75% within two months and prompted several automakers to pause or slow production
  • Since June, the Ministry of Commerce has required magnet producers to submit customer and transaction details under a new supply chain tracking system
  • Beijing began issuing a small number of export licenses following a June 27 trade agreement with the United States, but industry insiders report that approvals remain slow
  • Domestic rare earth magnet makers have cut output and are grappling with inventory backlogs amid weak electric vehicle demand
  • Efforts by the U.S., Japan and Europe to build alternative rare earth mines and processing facilities are under way but face years of regulatory and technical hurdles