China’s rare earth magnet exports to the US fell for a second month, reversing a brief recovery

Exports of rare earth magnets to the U.S. fell sharply in September, ending a months-long recovery as the two economic superpowers remain locked in a trade dispute. Secure alternative supply chains.

Data from China’s General Administration of Customs on Monday showed US-bound exports fell 28.7% to 420.5 tonnes in September from August. It was also down 30% from a year ago.

It was the second consecutive monthly decline after a brief rebound Started in JuneThat’s when Beijing agreed to immediately grant rare earth export permits during trade talks with US officials in London.

Chinese rare earth magnet companies are reported Since September, export license applications have been facing strict scrutiny. Customs figures also come earlier Beijing expanded Its export licensing regime earlier this month.

Predictably, China has a stranglehold on the production of rare-earth permanent magnets 90% of the marketAnd according to the International Energy Agency, the refining of the ingredients used to make it is equally dominant.

Magnets are important for technologies such as electric vehicles, renewable energy, electronics and defense systems. Beijing’s previous sanctions led to shortages and supply disruptions in industries earlier this year.

China’s export curbs also extended beyond just the US, with total rare earth magnet shipments falling 6.1% in September from August, according to customs data.

The disruptions have prompted the US and its partners to accelerate efforts to build alternative rare earth and critical mineral supply chains.

On Monday, the US and Australia signed an $8.5 billion mineral deal. The agreement includes funding for several projects to increase the supply of critical minerals used in rare earth and defense production and energy security.

The deal comes in the form of US-based Novon Magnetics A memorandum of understanding was signed Formed a strategic partnership with Australia’s Lynas Rare Earths earlier this month aimed at developing a scalable American supply chain for rare earth magnets.

However, producing rare earth magnets is extremely complicated and relies on upstream rare earth element mining and refining operations.

Currently, only a handful of US companies manufacture magnets locally, many in the early stages of production.