With the trade relationship between China and the United States becoming more strained by the day, a surprising set of materials is making headlines: rare earth elements. If you’re wondering what those are and why they matter, don’t worry—we’ve got you covered.
What’s Going On Between China and the U.S.?
Tensions between China and the United States have been building for years, and trade is one of the most contentious areas. In recent months, the U.S. raised tariffs on Chinese goods up to a historic 125%. China quickly responded, increasing tariffs on U.S. products to 84%, and going a step further by adding certain U.S. companies to its export control and “unreliable entity” lists.
This back-and-forth of tariffs and restrictions has created a volatile atmosphere. Both countries are using economic tools not just for trade advantage, but as political leverage. And this is where rare earth elements come in.
So, What Are Rare Earth Elements?
Rare earth elements (REEs) are a group of 17 metallic elements—including the lanthanides, plus scandium and yttrium. They’re not especially rare in nature, but they’re hard to extract and refine because they’re scattered in small amounts across the Earth’s crust.
These elements are essential for modern life. They’re used in everything from smartphones and laptops to electric vehicles, wind turbines, and even military systems like radar and missiles. Without rare earths, much of today’s technology wouldn’t function.
Why Rare Earths Matter in the Trade War
Here’s the thing: China dominates the global rare earth market. The country produces and processes around 90% of the world’s refined rare earth elements. That gives it enormous influence over the supply chain—and in a trade war, that kind of power matters.
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Recently, China has imposed new export restrictions on some rare earths, directly responding to U.S. tariffs. This move highlights how China can use its control over these elements as a bargaining chip. Since REEs are vital for U.S. industries like defense, clean energy, and tech, this has sparked real concern in Washington and beyond.
In response, the U.S. and other countries are scrambling to find alternative suppliers and boost domestic production. But developing new supply chains takes time and money—meaning China’s leverage won’t disappear overnight.
Rare earth elements might not be a household topic (yet), but they’re quickly becoming one. As trade tensions between the U.S. and China escalate, these 17 metals have become more than just raw materials—they’re now key pieces in a global game of economic chess. And how this plays out could shape the future of technology, defense, and international relations.