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The restriction on the export of minerals essential for technology and defense exposes the vulnerability of the United States in the trade war and reveals Trump's true weakness ahead of crucial negotiations.
With the publication of the “Announcement No. 62 of 2025”, the Chinese government redefined the rules of the trade war with the United States, shaking a truce that was already fragile. As detailed by Business Season, the measure imposes broad restrictions on the export of rare earths, a group of 17 chemical elements vital to the high-tech industry. By doing so, Beijing not only tightened its control over the global supply of these minerals, but also surgically exposed the Trump's weak point: deep American dependence of components that only China can supply on a large scale.
The strategic maneuver comes at a time of high tension, with a scheduled meeting between US President Donald Trump and Chinese leader Xi Jinping. The US reaction was immediate, with threats of additional 100% tariffs about Chinese products and new export controls. China, in turn, accuses the Americans of causing "unnecessary panic," claiming that the licenses will be approved for civilian use. However, the message was clear and put the Chinese delegation in an advantageous position for the upcoming negotiations.
Chinese monopoly and Western dependence
A China's strength this dispute is not a coincidence, but the result of decades of strategic planning. The country holds a near monopoly not only in the extraction, but mainly in the refining of rare earths, the complex process of separating them from other minerals. According to the consultancy Newland Global Group, Chinese exports of these materials represent about 70% of world supply, being crucial for the manufacture of magnets used in electric vehicle motors, wind turbines and countless other technological components.
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American dependence is even more critical in the defense sector. A single F-35 fighter, for example, requires more than 400 kilograms of rare earths in their radar systems, engines and stealth coatings. As the Business Season, this vulnerability is not limited to military hardware, extending to consumer products like smartphones and solar panels. Marina Zhang of the University of Technology Sydney argues that China has built a knowledge base and research and development network that is years ahead of any competitor, making replacing your supply chain a monumental task.
A 'bazooka' in the global supply chain
The Trump administration's response to the restrictions was harsh, reflecting the gravity of the situation. U.S. Treasury Secretary Scott Bessent described China's action bluntly: "This is China versus the world. They've aimed a bazooka at the supply chains and industrial base of the entire free world, and we won't stand for it."The threat of 100% tariffs on Chinese products and imposing export controls on strategic software shows that the US is willing to escalate the conflict, even if it generates global economic instability.
On the Chinese side, the stance is one of calm and control. A Commerce Ministry spokesperson stated that the measures are legitimate and that license requests for civilian purposes will be approved, accusing the US of "deliberately provoking disagreements." To increase the pressure, both nations also imposed new port fees on each other's ships, ending months of relative calm in the trade dispute. According to experts interviewed by Business Season, the timing chosen by China was calculated to frustrate the negotiation timetable that the Americans hoped to control.
The global race for alternatives and Brazil's potential
Faced with China's show of strength, the world is accelerating its search for alternative sources of rare earths. Australia, with large reserves of its own, is seen as a potential rival, but its production infrastructure is still limited, making processing expensive and time-consuming. Professor Marina Zhang estimates that, even with a coordinated effort, “It will take at least five years for the US and its allies to catch up with China” in processing capacity.
In this scenario, Brazil emerges as a player with great potential. Reports such as the US Mineral Commodity Summaries estimate that the country hold up to 23% of the world's known rare earth reservesProfessor Sidney Ribeiro of Unesp explained to BBC News Brasil that the country already has decades of academic research and active mining in states like Minas Gerais and Goiás. However, the challenge is enormous: many reserves are in environmentally sensitive areas, such as the Amazon, and the extraction process is complex and risky, as these elements often occur alongside radioactive materials like thorium and uranium.
More strategy than economics: the China's advantage at the negotiating table
While the restrictions may seem like a risky gamble, the direct economic impact on China is minimal. As found by Business Season, rare earths represent an insignificant portion of China's $18,7 trillion GDP, some estimates put their value at less than 0,1% of GDPProfessor Sophia Kalantzakos, from New York University, highlights that, although the economic weight is small, its strategic value is “enormous”, as it gives Beijing disproportionate pressure power.
By controlling access to these minerals, China is not seeking immediate financial gain, but rather to organize its operations ahead of trade negotiations. Analysts see the move as “your best immediate instrument” to pressure Washington to yield in other areas, such as reducing tariffs affecting its manufactured goods. China has demonstrated its willingness to absorb the impact of the trade war to achieve its long-term goals, while the US now has to address a vulnerability that directly affects its national security and technological leadership.
Do you agree with this change? Do you think it impacts the market? Leave your opinion in the comments; we'd love to hear from anyone who's experienced this firsthand.
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