Why rare earths are China’s trump card in trade war

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A sample of monazite, a mineral used in the rare earth industry to extract elements such as cerium, lanthanum, and neodymium, is displayed next to a magnification glass at the Geological Museum of China in Beijing on Oct 14, 2025.

PHOTO: REUTERS

Rare earths are among the most critical raw materials on the planet, deeply embedded in the technologies that underpin modern life. Yet few people had even heard of them until the eruption of the US-China trade war thrust them into the limelight.

With obscure names like gadolinium and dysprosium, rare earths are used across sectors – from semiconductors and iPhones to MRI machines and cancer treatments.

More recently, demand has been propelled by the green tech that’s helping to cut carbon emissions.

The world has long been reliant on China for rare earths – something the country has used to its advantage in responding to the trade war initiated by US President Donald Trump.

China has leveraged its dominance of the supply chain to retaliate against American tariffs by restricting the export of rare earths.

Unwinding these limits has been a flashpoint in trade talks between the two superpowers. The tighter Chinese controls have also injected momentum