Latest news with #LaurieChen
Yahoo
a day ago
- Automotive
- Yahoo
China's rare earths are flowing again, but not freely
By Christina Amann and Laurie Chen BERLIN/BEIJING (Reuters) -The threat of mass shutdowns across the automotive supply chain is fading as Chinese rare earth magnets begin to flow, though automakers and suppliers say production plans still face uncertainties and a continued risk of shortages. European suppliers have received enough licences to avoid the widespread disruptions predicted earlier this month but hundreds of permits remain pending, said Nils Poel, head of market affairs at supplier association CLEPA. The rate of issuance is "accelerating" and has risen to 60% from 25%, he said, but cases where the end users are based in the United States, or where products move through third countries like India, are taking longer or not being prioritised. "Overall the feeling is that we probably will still have production in July and that the impact will be manageable," he said. "Maybe here and there a production line will be affected, but we have avoided that for the moment." Volkswagen said in a statement to Reuters its supply of rare earth components was stable while rival Stellantis said it had addressed its immediate production concerns. China restricted exports of seven rare earths and related magnets in April in retaliation for U.S. tariffs. Three months later there remains huge uncertainty about how it intends to police its opaque and complex export licensing system. Since the restrictions were imposed, rare earth magnet exports from China have fallen roughly 75%, forcing some automaker production lines to halt in Asia, Europe and the United States. FROM 'FULL PANIC' TO 'BARE MINIMUM' The White House said on Thursday it had signed a deal with China to speed up rare earth approvals without providing details. Beijing said hours later both parties had confirmed details of the deal struck in London earlier this month, which was meant to resolve the rare earth issue, and it would process export licences in accordance with the law. Neither party detailed any changes to the existing export licensing system. U.S. Treasury Secretary Scott Bessent said in an interview with Fox Business Network on Friday that, under the agreement announced on Thursday, rare earth shipments to the United States from China would be expedited to all companies that have previously received them on a regular basis. "I am confident now... the magnets will flow," Bessent said. "This is a de-escalation." Two weeks ago the car industry was in a "full panic," but licence approvals by China have sped up and there is now less threat of a sudden stop, according to an executive at a leading U.S. automotive supplier and a source with knowledge of the supply chain at a major European carmaker. Both asked not to be named because of the sensitivity of the issue. China is approving the "bare minimum" of critical licences for European firms to avoid production stoppages, a European official told Reuters, also speaking on condition of anonymity. U.S. magnet maker Dexter Magnetic Technologies, which has defence clients, among others, has received just five of 180 licences since April, CEO Kash Mishra told Reuters, adding those were intended for non-defence sectors. "It's an extended delay," he said. "It's 45 days trying to get the paperwork right for the supplier, and then it's 45 more days or so before any licences are granted."
Yahoo
a day ago
- Automotive
- Yahoo
China's rare earths are flowing again, but not freely
By Christina Amann and Laurie Chen BERLIN/BEIJING (Reuters) -The threat of mass shutdowns across the automotive supply chain is fading as Chinese rare earth magnets begin to flow, though automakers and suppliers say production plans still face uncertainties and a continued risk of shortages. European suppliers have received enough licences to avoid the widespread disruptions predicted earlier this month but hundreds of permits remain pending, said Nils Poel, head of market affairs at supplier association CLEPA. The rate of issuance is "accelerating" and has risen to 60% from 25%, he said, but cases where the end users are based in the United States, or where products move through third countries like India, are taking longer or not being prioritised. "Overall the feeling is that we probably will still have production in July and that the impact will be manageable," he said. "Maybe here and there a production line will be affected, but we have avoided that for the moment." Volkswagen said in a statement to Reuters its supply of rare earth components was stable while rival Stellantis said it had addressed its immediate production concerns. China restricted exports of seven rare earths and related magnets in April in retaliation for U.S. tariffs. Three months later there remains huge uncertainty about how it intends to police its opaque and complex export licensing system. Since the restrictions were imposed, rare earth magnet exports from China have fallen roughly 75%, forcing some automaker production lines to halt in Asia, Europe and the United States. FROM 'FULL PANIC' TO 'BARE MINIMUM' The White House said on Thursday it had signed a deal with China to speed up rare earth approvals without providing details. Beijing said hours later both parties had confirmed details of the deal struck in London earlier this month, which was meant to resolve the rare earth issue, and it would process export licences in accordance with the law. Neither party detailed any changes to the existing export licensing system. U.S. Treasury Secretary Scott Bessent said in an interview with Fox Business Network on Friday that, under the agreement announced on Thursday, rare earth shipments to the United States from China would be expedited to all companies that have previously received them on a regular basis. "I am confident now... the magnets will flow," Bessent said. "This is a de-escalation." Two weeks ago the car industry was in a "full panic," but licence approvals by China have sped up and there is now less threat of a sudden stop, according to an executive at a leading U.S. automotive supplier and a source with knowledge of the supply chain at a major European carmaker. Both asked not to be named because of the sensitivity of the issue. China is approving the "bare minimum" of critical licences for European firms to avoid production stoppages, a European official told Reuters, also speaking on condition of anonymity. U.S. magnet maker Dexter Magnetic Technologies, which has defence clients, among others, has received just five of 180 licences since April, CEO Kash Mishra told Reuters, adding those were intended for non-defence sectors. "It's an extended delay," he said. "It's 45 days trying to get the paperwork right for the supplier, and then it's 45 more days or so before any licences are granted." Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
16-06-2025
- Business
- Yahoo
Exclusive-US-China trade truce leaves military-use rare earth issue unresolved, sources say
By Laurie Chen and Fanny Potkin BEIJING/SINGAPORE (Reuters) -The renewed U.S.-China trade truce struck in London left a key area of export restrictions tied to national security untouched, an unresolved conflict that threatens a more comprehensive deal, two people briefed on detailed outcomes of the talks told Reuters. Beijing has not committed to grant export clearance for some specialized rare-earth magnets that U.S. military suppliers need for fighter jets and missile systems, the people said. The United States maintains export curbs on China's purchases of advanced artificial intelligence chips out of concern that they also have military applications. At talks in London last week, China's negotiators appeared to link progress in lifting export controls on military-use rare earth magnets with the longstanding U.S. curbs on exports of the most advanced AI chips to China. That marked a new twist in trade talks that began with opioid trafficking, tariff rates and China's trade surplus, but have since shifted to focus on export controls. In addition, U.S. officials also signalled they are looking to extend existing tariffs on China for a further 90 days beyond the August 10 deadline agreed in Geneva last month, both sources said, suggesting a more permanent trade deal between the world's two largest economies is unlikely before then. The two people who spoke to Reuters about the London talks requested not to be named because both sides have tightly controlled disclosure. The White House, State Department and Department of Commerce did not immediately respond to requests for comment. China's Foreign and Commerce ministries did not respond to faxed requests for comment. President Donald Trump said on Wednesday the handshake deal reached in London between American and Chinese negotiators was a "great deal," adding, "we have everything we need, and we're going to do very well with it. And hopefully they are too." And U.S. Treasury Secretary Scott Bessent said there would be no "quid pro quo" on easing curbs on exports of AI chips to China in exchange for access to rare earths. CHINA CHOKEHOLD But China's chokehold on the rare earth magnets needed for weapons systems remains a potential flashpoint. China dominates global production of rare earths and holds a virtual monopoly on refining and processing. A deal reached in Geneva last month to reduce bilateral tariffs from crushing triple-digit levels had faltered over Beijing's restrictions on critical minerals exports that took shape in April. That prompted the Trump administration to respond with export controls preventing shipments of semiconductor design software, jet engines for Chinese-made planes and other goods to China. At the London talks, China promised to fast-track approval of rare-earth export applications from non-military U.S. manufacturers out of the tens of thousands currently pending, one of the sources said. Those licenses will have a six-month term. Beijing also offered to set up a "green channel" for expediting license approvals from trusted U.S. companies. Initial signals were positive, with Chinese rare-earths magnet producer JL MAG Rare-Earth, saying on Wednesday it had obtained export licences that included the United States, while China's Commerce Ministry confirmed it had approved some "compliant applications" for export licences. But China has not budged on specialized rare earths, including samarium, which are needed for military applications and are outside the fast-track agreed in London, the two people said. Automakers and other manufacturers largely need other rare earth magnets, including dysprosium and terbium. BIG ISSUES REMAIN The rushed trade meeting in London followed a call last week between Trump and Chinese leader Xi Jinping. Trump said U.S. tariffs would be set at 55% for China, while China had agreed to 10% from the United States. Trump initially imposed tariffs on China as punishment for its massive trade surplus to the United States and over what he says is Beijing's failure to stem the flow of the powerful opioid fentanyl into the U.S. Chinese analysts are pessimistic about the likelihood of further breakthroughs before the August 10 deadline agreed in Geneva. "Temporary mutual accommodation of some concerns is possible but the fundamental issue of the trade imbalance cannot be resolved within this timeframe, and possibly during Trump's remaining term," said Liu Weidong, a U.S.-China expert at the Institute of American Studies, Chinese Academy of Social Sciences. An extension of the August deadline could allow the Trump administration more time to establish an alternative legal claim for setting higher tariffs on China under the Section 301 authority of the USTR in case Trump loses the ongoing legal challenge to the tariffs in U.S. court, one of the people with knowledge of the London talks said. The unresolved issues underscore the difficulty the Trump administration faces in pushing its trade agenda with China because of Beijing's control of rare earths and its willingness to use that as leverage with Washington, said Ryan Hass, director of the John L. Thornton China Center at the Brookings Institution. "It has taken the Trump team a few punches in the nose to recognise that they will no longer be able to secure another trade agreement with China that disproportionately addresses Trump's priorities," Hass said.
Yahoo
15-06-2025
- Business
- Yahoo
Exclusive-US-China trade truce leaves military-use rare earth issue unresolved, sources say
By Laurie Chen and Fanny Potkin BEIJING/SINGAPORE (Reuters) -The renewed U.S.-China trade truce struck in London left a key area of export restrictions tied to national security untouched, an unresolved conflict that threatens a more comprehensive deal, two people briefed on detailed outcomes of the talks told Reuters. Beijing has not committed to grant export clearance for some specialized rare-earth magnets that U.S. military suppliers need for fighter jets and missile systems, the people said. The United States maintains export curbs on China's purchases of advanced artificial intelligence chips out of concern that they also have military applications. At talks in London last week, China's negotiators appeared to link progress in lifting export controls on military-use rare earth magnets with the longstanding U.S. curbs on exports of the most advanced AI chips to China. That marked a new twist in trade talks that began with opioid trafficking, tariff rates and China's trade surplus, but have since shifted to focus on export controls. In addition, U.S. officials also signalled they are looking to extend existing tariffs on China for a further 90 days beyond the August 10 deadline agreed in Geneva last month, both sources said, suggesting a more permanent trade deal between the world's two largest economies is unlikely before then. The two people who spoke to Reuters about the London talks requested not to be named because both sides have tightly controlled disclosure. The White House, State Department and Department of Commerce did not immediately respond to requests for comment. China's Foreign and Commerce ministries did not respond to faxed requests for comment. President Donald Trump said on Wednesday the handshake deal reached in London between American and Chinese negotiators was a "great deal," adding, "we have everything we need, and we're going to do very well with it. And hopefully they are too." And U.S. Treasury Secretary Scott Bessent said there would be no "quid pro quo" on easing curbs on exports of AI chips to China in exchange for access to rare earths. CHINA CHOKEHOLD But China's chokehold on the rare earth magnets needed for weapons systems remains a potential flashpoint. China dominates global production of rare earths and holds a virtual monopoly on refining and processing. A deal reached in Geneva last month to reduce bilateral tariffs from crushing triple-digit levels had faltered over Beijing's restrictions on critical minerals exports that took shape in April. That prompted the Trump administration to respond with export controls preventing shipments of semiconductor design software, jet engines for Chinese-made planes and other goods to China. At the London talks, China promised to fast-track approval of rare-earth export applications from non-military U.S. manufacturers out of the tens of thousands currently pending, one of the sources said. Those licenses will have a six-month term. Beijing also offered to set up a "green channel" for expediting license approvals from trusted U.S. companies. Initial signals were positive, with Chinese rare-earths magnet producer JL MAG Rare-Earth, saying on Wednesday it had obtained export licences that included the United States, while China's Commerce Ministry confirmed it had approved some "compliant applications" for export licences. But China has not budged on specialized rare earths, including samarium, which are needed for military applications and are outside the fast-track agreed in London, the two people said. Automakers and other manufacturers largely need other rare earth magnets, including dysprosium and terbium. BIG ISSUES REMAIN The rushed trade meeting in London followed a call last week between Trump and Chinese leader Xi Jinping. Trump said U.S. tariffs would be set at 55% for China, while China had agreed to 10% from the United States. Trump initially imposed tariffs on China as punishment for its massive trade surplus to the United States and over what he says is Beijing's failure to stem the flow of the powerful opioid fentanyl into the U.S. Chinese analysts are pessimistic about the likelihood of further breakthroughs before the August 10 deadline agreed in Geneva. "Temporary mutual accommodation of some concerns is possible but the fundamental issue of the trade imbalance cannot be resolved within this timeframe, and possibly during Trump's remaining term," said Liu Weidong, a U.S.-China expert at the Institute of American Studies, Chinese Academy of Social Sciences. An extension of the August deadline could allow the Trump administration more time to establish an alternative legal claim for setting higher tariffs on China under the Section 301 authority of the USTR in case Trump loses the ongoing legal challenge to the tariffs in U.S. court, one of the people with knowledge of the London talks said. The unresolved issues underscore the difficulty the Trump administration faces in pushing its trade agenda with China because of Beijing's control of rare earths and its willingness to use that as leverage with Washington, said Ryan Hass, director of the John L. Thornton China Center at the Brookings Institution. "It has taken the Trump team a few punches in the nose to recognise that they will no longer be able to secure another trade agreement with China that disproportionately addresses Trump's priorities," Hass said. Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten Fehler beim Abrufen der Daten
Reuters
07-06-2025
- Business
- Reuters
Critical minerals part deux: China's dominance
Follow on Apple or Spotify. Listen on the Reuters app. Decades ago, China foresaw what the U.S. didn't - a future dependent on critical minerals. Now, the U.S. is playing catch up as China's export controls threaten global supply chains. Join Laurie Chen, Ernest Scheyder and Jarrett Renshaw to hear the latest on critical minerals, particularly what China's dominance means for the modern world. Listen to part one here. Sign up for the Reuters Econ World newsletter here. Listen to the Reuters Econ World podcast here. Visit the Thomson Reuters Privacy Statement for information on our privacy and data protection practices. You may also visit to opt out of targeted advertising. Further Reading China's rare earth weapon changes contours of trade war battlefield, opens new tab China's rare earth export curbs hit the auto industry worldwide, opens new tab Global alarm as China's critical mineral export curbs take hold, opens new tab
