US-China tariff wars escalate as Beijing imposes export controls on rare earth minerals
- Marijan Hassan - Tech Journalist
- Apr 9
- 2 min read
The trade war between the United States and China has escalated further as Beijing announced retaliatory tariffs and, more significantly, new restrictions on the export of critical rare earth minerals. This move comes in direct response to the latest round of import taxes imposed by the Trump administration.
According to an announcement from its Ministry of Finance, China will implement a 34 percent tariff on all American goods entering the country effective April 10th. This is the same day Trump’s 34 percent additional tariff on Chinese supplies is set to be enacted. Beijing stated in its announcement that it "urges the United States to immediately cancel its unilateral tariff measures and resolve trade differences through consultation in an equal, respectful and mutually beneficial manner."
In another move with potentially broader implications, China’s Ministry of Commerce also announced new restrictions on the export of seven key rare earth minerals: samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium. These materials are indispensable to industries ranging from clean energy and electronics to defense and healthcare.
China’s ace card
While the new restrictions aren’t exclusively targeted at the US, analysts say the timing and China’s dominant position as a global supplier make the move unmistakably strategic.
China currently produces around 95% of the world’s rare earth minerals, according to the U.S. Geological Survey. The US, in turn, relies on China for approximately 78% of its rare earth imports, a 2020 report by the US International Trade Commission revealed.
“These are minerals that quite literally power the modern world,” said Samantha Han, a trade policy expert at the Center for Strategic Resources. “From electric vehicles and semiconductors to MRI machines and missile guidance systems, China’s move tightens the screws on global manufacturers.”
Samarium, for instance, is used in lasers and nuclear reactors; gadolinium in MRI imaging; terbium in sensors and audio devices; and dysprosium in nuclear control rods. Others, like yttrium and scandium, play critical roles in strengthening alloys and radar systems.
This is not the first instance of China using its control over critical minerals as leverage in trade disputes. In 2023, Beijing implemented export controls on gallium and germanium, which are essential for semiconductor manufacturing.
Markets react
The Dow Jones Industrial Average plummeted 2,231 points on Friday, while the tech-heavy NASDAQ fell 962 points, as investors absorbed the potential impact on manufacturing costs and supply chain disruptions.
