China Rare Earth Exports Surge to US: Easing Trade Tensions & Stabilizing Supply Chains

The global trade landscape for critical minerals is undergoing a significant transformation, marked by a notable surge in China’s rare earth element exports to the United States in June. This development signals a strategic de-escalation in trade tensions between the world’s two largest economies, with profound implications for high-tech industries critically reliant on these indispensable materials. The uptick follows the implementation of a recent bilateral trade framework, designed to foster stability in vital supply chains.

• China’s rare earth exports to the U.S. saw a dramatic 660% monthly rise in June, totaling 353 tons.
• Overall Chinese rare earth exports in June reached 3,188 tons, a 160% increase from May, yet remained 38% lower year-on-year.
• China maintains unparalleled dominance in the sector, controlling over 70% of global rare earth production and 90% of processing.
• Earlier Chinese export restrictions on rare earths were imposed in retaliation to U.S. tariffs, significantly disrupting global supply chains.
• The U.S. reciprocated by easing restrictions on certain tech products for China, including the resumption of Nvidia’s H20 AI chip sales.
• In June, the U.S. emerged as the second-largest destination for China’s rare-earth magnets, following Germany.

According to data from Beijing’s General Administration of Customs, China’s total rare earth exports in June reached 3,188 tons. This figure represents an approximate 160% increase from May, demonstrating a significant rebound in monthly shipments. Specifically, exports to the United States experienced a dramatic 660% monthly surge, culminating in 353 tons. Despite this substantial monthly uptick, overall rare earth exports in June were still 38% lower compared to the same period in the previous year. Furthermore, rare earth magnet exports for the first half of 2025 also recorded an 18.9% year-on-year decline, totaling 22,319 tons. This nuanced export pattern underscores ongoing market adjustments following a period of heightened trade friction.

Global Supply Chain Dynamics

Rare earth elements, a group of 17 chemically similar metallic elements, are crucial for a vast array of advanced technologies, including smartphones, jet engines, electric vehicles (EVs), and wind turbines, despite their somewhat misleading name. China’s unparalleled dominance in this sector is undeniable, accounting for over 70% of global rare earth production and more than 90% of processing capabilities. This extensive control renders China’s trade policies exceptionally influential on the global stage. Earlier this year, Beijing implemented export restrictions on seven rare earth elements and magnets, a move perceived as retaliation against steep U.S. tariffs. These curbs caused significant disruptions across global supply chains, affecting not only the U.S. but also compelling some European auto part suppliers to temporarily halt production.

The global ripple effect of these restrictions elicited strong reactions from international partners. EU trade chief Maros Sefcovic previously articulated the “alarming situation” confronting the European car industry, emphasizing that rare earths and permanent magnets are “absolutely essential for industrial production.” Addressing these export curbs was consequently identified as an EU “priority,” highlighting the strategic importance of these materials beyond the bilateral U.S.-China relationship. Illustrating the evolving trade dynamics, in June, the U.S. emerged as the second-largest destination for China’s rare-earth magnets, surpassed only by Germany.

In a reciprocal gesture indicative of the thawing trade environment, the United States has also initiated the easing of restrictions on certain tech products destined for China. This spirit of cooperation on rare earths prompted the White House to grant licenses for products previously subject to bans. For instance, U.S. tech giant Nvidia announced its intention to resume selling its H20 AI chip in China following the relaxation of export controls by the Trump administration, which had initially prohibited sales of the chip in April. This measured rollback of tech export bans underscores the delicate balance of strategic trade concessions being negotiated by both nations.

The recent trade adjustments in rare earth elements and advanced technology underscore the intricate interdependencies characteristic of the global economy. As Washington and Beijing continue to navigate their complex trade relationship, these developments suggest a pragmatic approach aimed at stabilizing critical supply chains and mitigating disruptions for industries worldwide.