The Economist: Rare Earths Give China Leverage in the Trade War, At a Cost
If China restricts exports, it would be painful for the U.S. but would also undermine China’s long-term economic agenda
Earlier this week Adamas Intelligence spoke with The Economist about the ongoing U.S. – China trade war and the potential economic pain that a ban on rare earth exports would have for the U.S. should China follow through on its not-so-subtle threats.
Among the points emphasized:
- The U.S. imported almost $300 million worth of NdFeB magnets from China in 2018 for use in everything from electric vehicle traction motors to wind power generators. If China is to halt exports of rare earth materials to the U.S., permanent magnets would have a broad impact on a lot of high-growth industries in the U.S. as well as applications in defense.
- Rare earth magnets are far from commodities. There are numerous different grades of NdFeB magnets with varying chemical and physical characteristics, different coatings, grain sizes, purity levels, impurity levels, etc. Because of this, it would be a major challenge for some end-users to quickly identify and qualify a suitable alternative source of supply for the exact type of magnet they need in their electric vehicle traction motor, wind power generator, or missile tail-fin actuators, for example.
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