BREAKING: China intensifies with magnet shipment as it says it will fight any trade war with the US to the end.

In early April 2025, China introduced new export restrictions on a suite of rare earth elements (REEs) and permanent magnets. Key elements affected included dysprosium, terbium, samarium, gadolinium, lutetium, scandium, yttrium, plus certain NdFeB (neodymium-iron-boron) and samarium-cobalt magnets.

Export licensing requirements: exporters must get licences, including detailed information about end‑users and end‑use.

Tighter customs enforcement, tracking, and oversight of magnet shipments. For example, China introduced a national tracking system for rare earth magnet sector reporting volumes, clients, etc.

Partial bans or restrictions on exporting finished magnets, especially those using “medium‑to‑heavy” rare earths or containing dysprosiumTerbium

Chinese exports of permanent rare earth magnets dropped by ~50 % month‑on‑month in April vs. March.

Compared to the same period a year earlier, magnet exports in May 2025 were down ~74 %, and April saw substantial year‑on‑year declines as well.

The drop was especially severe for shipments to key markets: for example, exports to the U.S. plunged ~93 % year‑on‑year in May; exports to Germany, Japan, etc., also sharply down.

In many cases supply chains were disrupted; automakers and manufacturers who rely on just‑in‑time or tightly buffered inventories found themselves scrambling.

Why this feels like trade war‑level escalation

Though China didn’t declare war, several features make the situation look very much like an escalation in a trade war:

1. Retaliation/leveraging: The move is widely seen as a countermeasure to sweeping U.S. tariffs or threats thereof. China is using its control over critical materials as leverage in broader trade / strategic conflicts.

2. Strategic materials & supply chain dependency: Rare earth magnets are essential in many advanced technologies—electric vehicles (EVs), wind turbines, semiconductors, defense systems, etc. When China restricts those, the ripple effects are global.

3. Rapid disruptive effect: The timing and sharpness of export drops, licensing delays, and customs hold‑ups caused immediate stress in industries worldwide. That kind of harm is characteristic of economic coercion or escalated trade conflict.

4. Opacity and uncertainty: Because requirements for licences, tracking, and customs classification (e.g. a single tariff code for many different magnets regardless of heavy rare earth content) are somewhat ambiguous or unevenly enforced, firms are exposed to risk, delays, or being denied without clear criteria. Such opacity increases the strategic leverage.