China's rare earth exports have experienced a dramatic shift in recent months, reflecting the complex interplay of global trade tensions, strategic resource management, and evolving supply chain dynamics. After a period of stringent export controls that rattled global industries, June 2025 marked a remarkable turnaround, particularly in the export of rare earth magnets to the United States, signaling a thaw in Sino-American trade relations.
According to data released by China's Customs Department, the export volume of rare earth magnets to the U.S. surged by an astonishing 660% in June compared to May, reaching 353 tons. This sevenfold increase highlights the impact of a recent trade agreement between the two economic giants, aimed at easing previous restrictions that had tightened in response to escalating tariffs and geopolitical frictions earlier in the year.
Beyond the U.S. market, China's global exports of rare earth magnets also rebounded robustly, climbing 157.5% month-on-month to 3,188 tons in June from 1,238 tons in May. This resurgence followed a sharp decline during April and May, when Beijing imposed stricter export controls on several rare earth minerals, a move seen as a countermeasure to U.S. tariffs. These controls had led to prolonged export permit processing times, severely disrupting supply chains worldwide and forcing some automakers outside China to halt production due to raw material shortages.
Despite the positive momentum in June, the export figures remain subdued compared to the previous year. June 2025's export volume was still 38.1% lower than June 2024, and the total rare earth exports for the first half of 2025 declined by 18.9% year-on-year, totaling 22,319 tons. Analysts, however, remain optimistic about a continued recovery into July, buoyed by the increased issuance of export permits and the easing of trade tensions.
The trade deal reached in June also includes provisions beyond rare earth magnets. Notably, Nvidia, a leading manufacturer of AI chips, announced plans to resume sales of its AI H20 chips to China, a significant development given the previous restrictions that had curtailed technology transfers amid the broader U.S.-China technology rivalry.
China's dominance in the rare earth sector is undisputed, currently supplying over 90% of the world's rare earth magnets. The strategic importance of these materials—vital for everything from electric vehicles to consumer electronics—makes any fluctuation in China's export policies a matter of global economic consequence.
While rare earth magnets have seen a rebound, China's exports of other critical minerals tell a different story. Germanium and antimony, two rare earth elements essential for weaponry, communications equipment, and solar cells, have seen dramatic export declines over the past three months. Customs data released on July 20, 2025, reveals that germanium exports plummeted by 95% and antimony exports dropped by 88% in June compared to January 2025.
This stark contrast underscores China's ongoing crackdown on unauthorized export activities. Authorities uncovered attempts to circumvent export controls through illicit means, including the mislabeling and rerouting of shipments. Reuters had previously reported unusual volumes of antimony being exported from Thailand and Mexico to the U.S., activities now linked to evasion of China's export restrictions.
Antimony was added to China's export control list in 2023, with germanium following in 2024, as part of Beijing's strategic response to U.S. chip restrictions. Since December 2024, these minerals have been banned from export to the United States, intensifying the supply challenges for American industries reliant on these materials.
The crackdown has had tangible effects on trade flows. For instance, China's antimony exports to Thailand dropped by 90% after peaking in January 2025, and exports to Mexico have ceased entirely since that time. These shifts highlight China's tightening grip on critical mineral exports amid a broader effort to control the supply of materials that are integral to both civilian and military technologies.
The dual narrative of recovery in rare earth magnet exports alongside the suppression of germanium and antimony shipments paints a complex picture of China's resource diplomacy. On one hand, Beijing appears willing to ease restrictions that facilitate industrial cooperation and economic engagement with the U.S., as evidenced by the rare earth magnets and AI chip trade resumption. On the other, it remains vigilant in safeguarding strategic minerals crucial for national security and technological competitiveness.
For global manufacturers and policymakers, these developments underscore the delicate balance of dependency and control in the rare earth market. The recent surge in magnet exports offers a glimmer of relief for industries grappling with supply chain disruptions, yet the stringent clampdown on germanium and antimony exports serves as a reminder of the geopolitical undercurrents shaping resource availability.
Looking ahead, experts anticipate that the positive export trends for rare earth magnets will continue, supported by the trade agreement and increased permit approvals. However, the sustained restrictions on other critical minerals suggest that China will maintain a cautious approach, leveraging its dominant position to navigate the evolving landscape of international trade and technology competition.
As the world watches these shifts unfold, the interplay between economic cooperation and strategic competition remains at the forefront of Sino-American relations. The rare earth sector, with its vital role in modern technology and defense, stands as a key battleground where the outcomes will resonate across industries and countries alike.
