After negotiations, China and the U.S. have mutually agreed to significantly lower tariffs. Foreign media, citing sources, reported that China has issued export licenses to four rare earth magnet manufacturers. This is the first approval of such export applications since Beijing implemented export restrictions on seven categories of medium to heavy rare earth materials last month.
● Covering European and Vietnamese Clients
The report indicates that Baotou Tianhe Magnetics Co., which specializes in producing magnets for electric vehicle motors, obtained an export license at the end of April to export rare earth magnet raw materials to Volkswagen in Germany.
In response to foreign media inquiries, Volkswagen stated: “We have been informed that the Chinese government has issued export licenses to some of Volkswagen's magnet suppliers.” An insider revealed that Volkswagen had contacted Beijing hoping to receive assistance during the export license approval process.
Another informed source mentioned that Beijing Zhongke San Huan, Baotou Zhongke Rare Earth, and Innuovo Tech Co., Ltd. in Zhejiang have also been granted export licenses.
The report specifies that export licenses are issued to specific suppliers for each client, and it is unclear whether all clients of the four companies have received Beijing's approval. According to one source, the currently issued licenses only cover clients in Europe and Vietnam.
● China Expected to Continue Rare Earth Export Limits
However, these export licenses were issued before the trade truce agreement between China and the U.S. was reached on the 12th. Industry insiders believe the agreement might make it easier for American buyers to obtain licenses.
China's Ministry of Commerce recently released a statement pledging to strictly crack down on smuggling of strategic minerals such as gallium, germanium, antimony, tungsten, and medium to heavy rare earths and will launch a special enforcement action soon. An account affiliated with China Central Television, “Yuyuantantian,” also posted on the same day stating that rare earth export control measures are still in effect.
Some analysts suggest that these statements are seen as signals of Beijing's intention to maintain export restrictions. Other analyses indicate that rare earth export restrictions apply to all countries, with the Chinese government hoping to retain this policy while potentially simplifying the approval process for U.S. buyers.