China’s exports of rare earth products, crucial components in advanced manufacturing and central to ongoing trade disputes with the United States, dropped sharply in May to their lowest level in five years.
This comes as Beijing’s new export restrictions, in effect since April, tightened their grip on global supply and sent ripples through industries reliant on key rare earth magnets.
Data compiled from Chinese customs and Bloomberg News reveal a 61% year-on-year slump to 2,117 tons for May, the smallest monthly volume since the pandemic-stricken February of 2020.
The rare earth products category, primarily made up of high-value magnets, has seen volumes drop for two consecutive months as tighter regulations accelerated a supply squeeze.
The controls, which regulators imposed on April 4, go beyond individual rare earth elements to encompass magnets containing even trace amounts of those materials.
China’s near-monopoly of these essential resources—accounting for around 90% of global permanent magnet production—is a key lever in its trade battle with the US.
US and Chinese trade officials convened in London earlier this month to seek resolution, with US President Donald Trump asserting that China would guarantee upfront supplies of both magnets and rare earths—a statement still to be borne out by actual shipments.
Industry observers and US policymakers are awaiting updated trade figures, especially as Chinese customs is set to release fresh data on magnet exports this Friday.
In the first quarter of 2025—before the export clampdown—magnets represented nearly 90% of all rare earth product exports, underscoring their pivotal role in technology supply chains and global manufacturing.
