Explainer: Impact of China’s rare earth mineral curbs
Firing a fresh salvo in the ongoing trade war with the United States, China, on April 14, suspended the export of rare earth minerals that are critical for manufacturing in the automobile, semiconductor, defence and aerospace sectors.
The restrictions apply to seven minerals: samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium, to which the US is said to be vulnerable as these are not being produced by it. Over 70 per cent of US imports of rare earth minerals are from China.
The depletion of supplies could impact the production and maintenance of certain defence systems, as well as industrial products. This has implications not only for the US but other countries, including India, as well.
China first employed this card in 2010, when it stopped exports to Japan over a fishing trawler dispute.
About the minerals
Rare earth minerals are a group of 17 elements present in the Earth’s crust like other metal and non-metal ores that can be mined. Though referred to as “rare”, their occurrence is plentiful but are spread thinly. They are so called because it took a long time to identify and isolate them and also because they are widely dispersed; it requires huge amounts of ore and expensive processes to extract usable quantities.
It was in 1787 that the first rare earth mineral, gadolinite, was discovered in Sweden.
Generally lustrous silvery-white in appearance, these have a vast range of applications in electrical and electronic components, lasers, glass, magnetic materials and industrial processes. They are a key requirement for manufacturing semiconductor chips, the motors of electric vehicles, components of fighter jets and guided missiles, renewable energy, and LED lights.
Many rare earths have chemical properties that make them heat-resistant, so they can be used to create high quality magnets, glass, lights and batteries. Magnets made from rare earths are said to be much more powerful than other types, especially those used in large or heavy duty motors.
Top producer
According to the US Geological Survey, China has the highest deposits of rare earths, estimated at 44 million metric tonnes and a production of 2,70,000 metric tonnes in 2024.
Brazil is reported to be at number two, with reserves of 21 million tonnes, but is not a major producer. At the third spot is India, with estimated reserves of 6.9 million tonnes as per the US agency, but with a production of just 2,900 tonnes in 2024. Australia, Russia, Vietnam, US and Greenland come next in this order.
US President Donald Trump has said he is keen to annex Greenland, an autonomous region under Denmark that holds reserves of 1.5 million tonnes that are largely unexploited. He has also stepped in to broker a peace deal between Russia and Ukraine, in return for access to Ukraine’s mineral wealth.
The US, according to its own agency, has reserves of 1.9 million tonnes, with an output of 45,000 tonnes, or about 15 per cent of the global production.
The geopolitics
Rare earth minerals have emerged as an important instrument of geopolitics and geostrategic posturing.
Until 1948, most of the world’s rare earths were sourced from placer sand deposits in India and Brazil. In the 1950s, South Africa became the major source and then from the 1960s to the 1980s, the US was the leading producer, till China entered the scene and took control.
The Geological Survey of India (GSI), under the Ministry of Mines, is actively engaged in carrying out mineral exploration across India, including for critical minerals.
The ministry recently informed Parliament of the launch of the National Critical Mineral Mission. Under it, GSI has intensified its exploration activities across the country. During the 2024-25 field season, GSI took up 195 exploration projects, including 35 in Rajasthan.
India’s imports of rare earth minerals grew from 1,848 tonnes in 2019-20 to 2,279 tonnes in 2023-24, with China being the largest supplier. In 2023-24, imports from China totalled 1,488 tonnes, or about 65 per cent, while that from the US were 84 tonnes.
India