According to the Financial Times, Chinese government officials are now evaluating whether they will impose their own sanctions on the United States. In particular, they are considering a cut-off of the supply of their prized rare-earth metals to U.S. military contractors. The Financial Times quotes an unidentified Chinese government adviser: “The government wants to know if the US may have trouble making [Lockheed-Martin’s] F-35 fighter jets if China imposes an export ban.” Assumedly, they are investigating whether such a ban would be effective.
Presently, China controls 80% of the world’s processing of rare-earth metals, and the U.S. has to send its raw ores to China for processing. Recently, Beijing has drafted new proposed rules for regulation over their rare-earth industry, including the regulation of shipments to “help safeguard state security.” The Ministry of Industry and Information Technology proposed controls over the export of 17 rare-earth minerals. Another factor is that China’s huge infrastructure projects require more and more rare-earth metals for their own use.
