Myanmar's Rare Earth Mines as China's Trade War Leverage; Beijing Strengthens Control

(Bangkok, 13th) According to sources, a new rare earth mine in eastern Myanmar is protected by a China-backed Myanmar ethnic local armed group (the militia). It is claimed that Beijing is taking action to ensure control over these minerals and use rare earths as leverage in the trade war with Washington.
Reuters quoted two sources saying that the Chinese side is mining a new deposit in the hills of Shan State in eastern Myanmar, with at least 100 people working around the clock to extract the ore using chemicals.
Two other local residents revealed that they witnessed trucks transporting materials from mines located between Mong Hsat and Mong Yun to the Chinese border about 200 kilometers away.
These four people also said that the mines operate under the protection of the largest militia group in Shan State, the United Wa State Army. The United Wa State Army controls one of the world's largest tin mines. The nonprofit conflict resolution organization, the US Institute of Peace, states that the United Wa State Army has long-standing commercial and military ties with China.
Reuters, using images from commercial satellite providers Planet Labs and Maxar Technologies, identified some of the rare earth mining sites.
Patrick Meehan, a lecturer at the University of Manchester in the UK who has researched Myanmar's rare earth industry, analyzed the satellite images and concluded that these medium to large mines appear to be the first significant facilities outside of Kachin State in northern Myanmar. He said, "There is an entire rare earth belt stretching from Kachin State down through Shan State into parts of Laos."
China's Ministry of Commerce, the United Wa State Army, and the Myanmar military government have not responded to Reuters' inquiries.
China almost monopolizes the business of processing heavy rare earths into magnets, which are used in critical products such as wind turbines, medical equipment, and electric vehicles. However, Beijing heavily relies on Myanmar to provide the rare earth metals and oxides needed to produce these magnets. Chinese customs data shows that in the first four months of this year, Myanmar accounted for almost half of China's total imports of rare earth metals and oxides.

Recently, a major mining belt in northern Myanmar was occupied by an armed group that is battling the China-backed Myanmar military government, limiting Beijing's access to new mineral stocks such as dysprosium and terbium.
For Beijing, acquiring rare earth resources is increasingly important. After U.S. President Trump resumed the trade war with China this year, Beijing tightened restrictions on the export of rare earths and rare earth magnets. Although China recently approved increased exports of rare earths, and Trump has hinted at progress in resolving the dispute, these moves have disrupted the core supply chains of global automakers, aerospace manufacturers, semiconductor companies, and military contractors.