
Critical minerals give China an edge in trade negotiations
By SIMINA MISTREANU
China's dominance over critical minerals in global supply chains was a powerful bargaining chip in trade talks between Beijing and Washington that concluded with both sides saying they have a framework to pursue a deal.
China has spent decades building the world's main industrial chain for mining and processing such materials, which are used in many industries such as electronics, advanced manufacturing, defense and health care.
Mines and factories in and around Ganzhou, a key production hub for rare earths, underpin China's control over the minerals. Many residents grew up collecting rocks containing the valuable minerals from the forested hills surrounding the southern city and today make a living from mining, trading or processing them.
Responding to ever higher tariffs and other controls on advanced technology, China told exporters of certain key rare earths and other critical minerals to obtain licenses for every shipment abroad. Approvals can take weeks, leading to supply chain disruptions in the U.S. and other countries.
President Donald Trump said Wednesday that China would make it easier for American industry to obtain much-needed needed magnets and rare earth minerals, clearing the way for talks to continue between the world's two biggest economies. In return, Trump said, the U.S. will stop efforts to revoke the visas of Chinese nationals on U.S. college campuses.
But details remain scarce. Beijing has not confirmed what the negotiators agreed to, and Chinese President Xi Jinping and Trump himself have yet to sign off on it.
The Chinese Commerce Ministry said Saturday it had approved a 'certain number' of export licenses for rare earth products, apparently acknowledging Trump's personal request to Xi during a phone call last week. And on Wednesday, the Ganzhou-based rare-earth conglomerate JL MAG Rare-Earth Co. confirmed it had obtained some export licenses for shipments to destinations including the U.S., Europe and Southeast Asia.
Experts say, however, Beijing is unlikely to do away with the permit system enabling it to control access to those valuable resources.
The only scenario in which China might deregulate its critical minerals export is if the U.S. first fully removes tariffs imposed on Chinese goods as part of the trade war, said Wang Yiwei, a professor of international affairs at Renmin University, echoing the Chinese government's earlier stance.
'Without that,' he said, 'it will be difficult to blame China for continuing to strengthen its export controls.'
In 1992, Deng Xiaoping, the leader who launched China's ascent as the world's biggest manufacturing power, famously said 'the Middle East has oil, China has rare earths,' signaling a desire to leverage access to the key minerals.
Several generations later, Beijing has made its rich reserves of rare earths, a group of 17 minerals that are abundant in the earth's crust but hard, expensive and environmentally polluting to process, a key element of China's economic security. In 2019, during a visit to a rare earth processing plant in Ganzhou, Xi described rare earths as a 'vital strategic resource.'
China today has an essential monopoly over 'heavy rare earths,' used for making powerful, heat-resistance magnets used in industries such as defense and electric vehicles.
The country also produces around 80% of the world's tungsten, gallium and antimony, and 60% of the world's germanium -– all minerals used in the making of semiconductors, among other advanced technologies.
The risks of dependency on Chinese suppliers first came into focus in 2010, when Beijing suspended rare earths exports to Japan due to a territorial dispute. The ban was lifted after about two months, but as a precaution, Japan invested in rare earths processing plants in other countries and began stockpiling the materials.
Beijing's across-the-board requirement for export licenses for some critical minerals has put pressure on world electronics manufacturers and automakers.
Some auto parts makers in Europe have shut down production lines due to delays in supply deliveries, according to the European Association of Automotive Suppliers. In the U.S., Tesla CEO Elon Musk said a shortage of rare earths is affecting his company's work on humanoid robots.
In the drab industrial hub of Ganzhou, cradled by the scenic Dayu Mountains, the U.S.-China trade war is still a distant stressor. Miners and small mineral traders interviewed by The Associated Press said they are more concerned about depleting the mountains' once-abundant resources.
Zhong, a tungsten factory manager in Ganzhou who would only give his last name, worked his way up to manager from a miner, but he's unsure there is a future for him and others in the industry.
'I find growing difficulties to source tungsten these days,' he said, adding that smaller mines and trading companies are slowly disappearing as the resources are dwindling. Tungsten is an ultra-hard metal used in armor-piercing ammunition, nuclear reactors and semiconductors.
At least five tungsten mines have closed in the area in recent years, according to state media. Remaining reserves are deeper and harder to extract and process after decades of exploitation, said Li Shangkui, chairman of the Ganzhou-based Jiangxi Yuean Advanced Materials Co., Ltd.
Processing factories in Ganzhou now routinely source materials from other provinces or other countries. Zhong's plant imports some raw materials from places like Africa and Cambodia.
Major state-owned and private companies in Ganzhou are also ramping up investments abroad. Tungsten producer Ganzhou Haisheng, for instance, announced last year a $25 million investment in a new tungsten plant in Thailand.
Whatever the challenges in procuring raw materials, China likely will seek to maintain its dominance in critical minerals, said Fabian Villalobos, an engineer and critical minerals expert at the RAND think tank.
Between 2020 and 2023, the U.S. imported at least 70% of the rare earth compounds it used from China, according to the U.S. Geological Survey. It has diversified its sources in recent years, but still mainly relies on China.
Since beginning his second term in office, Trump has made improving access to critical minerals a matter of national security. But the U.S. has an incredibly long way to go to catch up with China, experts say.
The sole operational U.S. rare earths mine, in Mountain Pass, California, is unable to separate heavy rare earths. It sends its ore to China for processing. The U.S. Defense Department has provided funding to the mine's owner, MP Materials, to build new separation facilities. It will take months to build and still only produce a fraction of what is needed.
Friction over the issue has opened the way for government-backed financing that was unavailable before, said Mark Smith, who ran the Mountain Pass mine in the early 2010s and now leads NioCorp. It's seeking about $780 million in financing through the U.S. Export-Import Bank to build a processing facility in Nebraska for critical minerals including rare earths.
The Defense Department has committed $439 million to building domestic rare earth supply chains, but building a complete mining and processing industrial chain like China's could take decades.
'There are going to be some real issues here unless we can figure out how to get along with China for a period of time while we're developing our own resources and our mainstream processing,' Smith said.
The spotlight on critical minerals also provides opportunities for smaller miners to invest in extracting and processing some critical minerals, such as tungsten, considered 'niche' because they are needed in relatively small amounts in key industries, said Milo McBride, an expert on sustainability and geopolitics at the Carnegie Endowment for International Peace.
'For many of these companies, the business strategy hedges on a scenario where the U.S. and China become more confrontational and where trade relations become more uncomfortable,' McBride said. 'And all of a sudden, what was once an uneconomic project somewhere outside of China starts to make more sense.'
Associated Press news researcher Shihuan Chen contributed to this story.
© Copyright 2025 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed without permission.
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles

Nikkei Asia
2 hours ago
- Nikkei Asia
Hulk Hogan, pro wrestling icon and controversial figure, dies at 71
(Reuters) -- Hulk Hogan, the American sports and entertainment star who made professional wrestling a global phenomenon and loudly supported Donald Trump for president, has died at the age of 71, World Wrestling Entertainment said on Thursday. "WWE is saddened to learn WWE Hall of Famer Hulk Hogan has passed away. One of pop culture's most recognizable figures, Hogan helped WWE achieve global recognition in the 1980s," WWE said on X. It gave no cause of death. The bleach-blond, mahogany-tanned behemoth became the face of professional wrestling in the 1980s, helping transform the mock combat from a seedy spectacle into family-friendly entertainment worth billions of dollars. A key moment in that evolution came at the WrestleMania III extravaganza in 1987, when Hogan hoisted fellow wrestler Andre the Giant before a sold-out Pontiac Silverdome in Michigan for a thunderous body slam of the Frenchman. Hogan parlayed his wrestling fame into a less successful career in Hollywood, starring in films like "Rocky III" and "Santa With Muscles," but kept returning to the ring as long as his body would allow. In 2024, he appeared at the Republican National Convention to endorse the presidential bid of Trump, who in the 1980s had played host to Hulk-headlined WrestleManias. Hogan said he made the decision to support the Republican candidate after seeing his combative, fist-pumping reaction to an attempted assassination on the campaign trail. "Let Trumpamania run wild, brother!" Hogan bellowed to a cheering crowd, ripping off his shirt to reveal a Trump tank top. "Let Trumpamania rule again!" Born Terry Gene Bollea in Augusta, Georgia, on Aug. 11, 1953, the future Hulk and his family soon moved to the Tampa, Florida area. After high school, he played bass guitar for area rock bands, but felt a pull to the red-hot wrestling scene in Florida in the 1970s. Many of the details of his career were show business exaggerations, representative of the blurred lines between fact and fiction in wrestling. His first trainer reportedly broke Hogan's leg to dissuade him from entering the business, but he kept at wrestling, weight training, and -- he later admitted -- anabolic steroids. He gained in notoriety as his biceps turned into what he dubbed the "24-inch pythons." The "Hulk" moniker came from comparisons to the comic-book hero portrayed on TV at the time. He would end up paying royalties to Marvel Comics for years. "Hogan" was the invention of promoter Vincent McMahon, the owner of the World Wrestling Federation (WWF), who wanted Irish representation among his stable of stars. His appearance as wrestler Thunderlips in "Rocky III," where he dwarfed leading man Sylvester Stallone, rocketed Hogan to the mainstream. Upon a return to the WWF, now controlled by McMahon's son Vincent K., he defeated the Iron Sheik in 1984 to claim the world championship, a belt he would hold for four years. Hogan became a household name, appearing on the cover of magazine Sports Illustrated and performing alongside pop culture stars like Mr. T. The WWF came to dominate wrestling, anchored by its annual WrestleMania pay-per-view events. Later, he joined competitor World Championship Wrestling, swapping his trademark yellow tights for black and taking on a persona as the villainous "Hollywood" Hogan, the head of a gang of rulebreakers known as the New World Order. The gimmick reinvigorated his career. Hogan eventually returned to the WWF, now known as WWE, and faced Dwayne "The Rock" Johnson at WrestleMania in 2002. "I'm in better shape than him," Hogan told Reuters at the time, five months shy of his 50th birthday. "I'll stand next to The Rock and pose down with him if he wants to." The Rock ultimately won the match. Hogan was inducted twice into the WWE Hall of Fame, and referred to himself as the "Babe Ruth" of wrestling -- after the New York Yankees' famed baseball player. But Hogan's support of Trump in 2024 did not go down well with all wrestling fans, and he also faced other controversies. Gossip website Gawker was shuttered after it posted parts of a sex tape between him and a friend's wife and Hogan sued on privacy grounds, winning a $140 million judgment. In 2015, he was suspended by the WWE after another surreptitious recording revealed that Hogan had used a racial slur. He was reinstated in 2018. He was married three times and had two children, who starred alongside him and first wife Linda in a 2005-2007 reality TV show, "Hogan Knows Best."

Nikkei Asia
3 hours ago
- Nikkei Asia
Hulk Hogan, who helped turn pro wrestling into billion-dollar spectacle, dies at 71
(Reuters) -- Hulk Hogan, the American sports and entertainment star who made professional wrestling a global phenomenon and loudly supported Donald Trump for president, has died at the age of 71, World Wrestling Entertainment said on Thursday. "WWE is saddened to learn WWE Hall of Famer Hulk Hogan has passed away. One of pop culture's most recognizable figures, Hogan helped WWE achieve global recognition in the 1980s," WWE said on X. It gave no cause of death. The bleach-blond, mahogany-tanned behemoth became the face of professional wrestling in the 1980s, helping transform the mock combat from a seedy spectacle into family-friendly entertainment worth billions of dollars. A key moment in that evolution came at the WrestleMania III extravaganza in 1987, when Hogan hoisted fellow wrestler Andre the Giant before a sold-out Pontiac Silverdome in Michigan for a thunderous body slam of the Frenchman. Hogan parlayed his wrestling fame into a less successful career in Hollywood, starring in films like "Rocky III" and "Santa With Muscles," but kept returning to the ring as long as his body would allow. In 2024, he appeared at the Republican National Convention to endorse the presidential bid of Trump, who in the 1980s had played host to Hulk-headlined WrestleManias. Hogan said he made the decision to support the Republican candidate after seeing his combative, fist-pumping reaction to an attempted assassination on the campaign trail. "Let Trumpamania run wild, brother!" Hogan bellowed to a cheering crowd, ripping off his shirt to reveal a Trump tank top. "Let Trumpamania rule again!" Born Terry Gene Bollea in Augusta, Georgia, on Aug. 11, 1953, the future Hulk and his family soon moved to the Tampa, Florida area. After high school, he played bass guitar for area rock bands, but felt a pull to the red-hot wrestling scene in Florida in the 1970s. Many of the details of his career were show business exaggerations, representative of the blurred lines between fact and fiction in wrestling. His first trainer reportedly broke Hogan's leg to dissuade him from entering the business, but he kept at wrestling, weight training, and -- he later admitted -- anabolic steroids. He gained in notoriety as his biceps turned into what he dubbed the "24-inch pythons." The "Hulk" moniker came from comparisons to the comic-book hero portrayed on TV at the time. He would end up paying royalties to Marvel Comics for years. "Hogan" was the invention of promoter Vincent McMahon, the owner of the World Wrestling Federation (WWF), who wanted Irish representation among his stable of stars. His appearance as wrestler Thunderlips in "Rocky III," where he dwarfed leading man Sylvester Stallone, rocketed Hogan to the mainstream. Upon a return to the WWF, now controlled by McMahon's son Vincent K., he defeated the Iron Sheik in 1984 to claim the world championship, a belt he would hold for four years. Hogan became a household name, appearing on the cover of magazine Sports Illustrated and performing alongside pop culture stars like Mr. T. The WWF came to dominate wrestling, anchored by its annual WrestleMania pay-per-view events. Later, he joined competitor World Championship Wrestling, swapping his trademark yellow tights for black and taking on a persona as the villainous "Hollywood" Hogan, the head of a gang of rulebreakers known as the New World Order. The gimmick reinvigorated his career. Hogan eventually returned to the WWF, now known as WWE, and faced Dwayne "The Rock" Johnson at WrestleMania in 2002. "I'm in better shape than him," Hogan told Reuters at the time, five months shy of his 50th birthday. "I'll stand next to The Rock and pose down with him if he wants to." The Rock ultimately won the match. Hogan was inducted twice into the WWE Hall of Fame, and referred to himself as the "Babe Ruth" of wrestling -- after the New York Yankees' famed baseball player. But Hogan's support of Trump in 2024 did not go down well with all wrestling fans, and he also faced other controversies. Gossip website Gawker was shuttered after it posted parts of a sex tape between him and a friend's wife and Hogan sued on privacy grounds, winning a $140 million judgment. In 2015, he was suspended by the WWE after another surreptitious recording revealed that Hogan had used a racial slur. He was reinstated in 2018. He was married three times and had two children, who starred alongside him and first wife Linda in a 2005-2007 reality TV show, "Hogan Knows Best."

Nikkei Asia
4 hours ago
- Nikkei Asia
EU-China ties at 'inflection point,' von der Leyen says after tense Beijing summit
BEIJING, July 24 (Reuters) -- EU-China trade ties have hit a "clear inflection point," European Commission President Ursula von der Leyen said on Thursday in Beijing, capping a tense summit with top Chinese leaders dominated by concerns on commerce and the Ukraine war. Expectations were low for the summit in the Chinese capital marking 50 years of diplomatic ties after weeks of escalating tension and wrangling that led to the duration being abruptly halved to a single day at Beijing's request. "We have very frankly and openly raised our concerns ... on the trade, investment and geopolitical issues. ... We have partially identified solutions," von der Leyen told a press conference after meeting with Chinese President Xi Jinping and Premier Li Qiang. When asked about a potential trade deal with the United States, the EU chief said the bloc's focus has been on achieving a negotiated solution but all other instruments are on the table until "we have a satisfactory result." "Our relationship with China is of importance, but it stands on its own merits. It's independent of the actions or issues we have with others," she said. Xi earlier told von der Leyen and European Council President Antonio Costa that the challenges facing Europe do not come from China, urging the bloc to "properly handle differences and frictions." "It is hoped that the European side will keep the trade and investment market open and refrain from using restrictive economic and trade tools," Xi said, according to the official Xinhua News Agency. EU trade actions in the past year have targeted Chinese exports of electric vehicles, among other goods, and its officials have repeatedly complained about Chinese industrial overcapacity as the bloc's trade deficit with China ballooned to a historic 305.8 billion euros ($360 billion) last year. Von der Leyen told the press that the Chinese leadership has started to look into the overcapacity issue and expressed willingness to support more consumption. "We think increasing market access for European companies in China, limiting the external impact of involution, and reducing export controls are important steps forward," she told Premier Li earlier, according to a pool report. She described her meeting with Xi as "excellent." The two sides also issued a joint statement on climate, reiterating their commitment to new climate action plans across the whole economy. They will boost cooperation in areas such as energy transition, adaptation, methane emissions management and control, carbon markets, and green and low-carbon technologies, the joint statement said. At the start of U.S. President Donald Trump's second term, both sides had more of a consensus in working together to tackle trade challenges from the United States, said Cui Hongjian, a foreign policy professor at Beijing Foreign Studies University. "Recently the situation has changed," Cui said. "The EU has continued to compromise with the United States, which means that there is currently a lack of impetus for EU-China ties to become closer." After intense negotiations, the EU is likely to seal a trade deal with the United States for a broad tariff of 15% on its exports, down from 30% threatened by Trump. At Thursday's summit, the EU leaders also conveyed their expectations for China to discourage Russia in its war against Ukraine. "What's important is that we have a ceasefire and negotiations at the table take place, that there is a true and genuine willingness to find solutions to end the bloodshed," von der Leyen said at the press conference. Topics the Europeans brought up in the talks also included China's rare-earth export controls that disrupted supply chains worldwide, causing temporary stoppages in European automotive production lines in May. "We need reliable and secure supplies of critical raw materials from China ... we acknowledge China's efforts on fast-tracking licenses for critical raw materials, and we agreed to have an upgraded export supply mechanism," von der Leyen said. China's exports of rare-earth magnets to the EU surged in June by 245% from May, to stand at 1,364 metric tons, though that was still 35% lower than the year-earlier figure, customs data showed. On Thursday, China's Foreign Ministry defended the rare-earths curbs as being "in line with international practice," while pledging stronger dialogue and cooperation with relevant countries and regions in the field of export controls.