China has implemented new export restrictions on rare earth elements. This has added critical elements such as scandium and dysprosium to the restricted list. The new regulation covers a total of seven elements, and information is requested from recipient countries for the export of these materials.
China will impose new restrictions on rare earth elements
A license requirement has also been introduced. The new regulations are expected to cause delays in the supply chain and increase costs. Rare earth elements play a critical role in high-tech areas such as electronics, energy, defense and aviation.
Scandium is especially preferred in high-frequency wave filters used in 5G, Wi-Fi and base stations. Dysprosium, on the other hand, is a key component in many sectors, from electric vehicle engines to hard disk drives, from nuclear reactors to satellite systems.
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Other elements included in the restrictions include gadolinium, terbium, yttrium, lutetium and samarium. Using substitute materials instead of these elements causes problems such as high costs and decreased performance.
China is the global leader in rare earth element production. China mines approximately 70 percent of the world’s minerals and accounts for 85 percent of refined production. This superiority is the result of investments in mining, refining and processing over many years.
The new export restrictions are an extension of ongoing trade tensions with the US. Analysts predict that the prices of restricted elements could increase two to fivefold.
The new decisions are expected to have a direct impact on technology giants such as Broadcom, Qualcomm, TSMC, Samsung, Seagate and Western Digital. What do you think about this? You can share your views with us in the comments section below.
