Some Chinese rare earth suppliers are declining to ship to the U.S. for fear of repercussions from BeijingU.S. officials have repeatedly asked China to stick to commitments made in Busan and Beijing over the past year to ensure the smooth flow of rare earth export licences. The persistence of the problem has put it on the U.S. planning agenda ahead of Xi's September 24 visit, a source familiar with the work said.
A handful of Chinese suppliers have refused to ship rare earths to U.S. companies since early August when China imposed sanctions on the Responsible Business Alliance (RBA), a U.S. supply chain monitor, a separate source with direct knowledge of the situation said.
With China deploying its own trade compliance weapons, the companies were wary of punishment from Beijing for complying with the due diligence framework of the Responsible Minerals Initiative (RMI), a global mineral supply chain audit programme connected with the RBA, the source said.
Other Chinese rare earths companies had already stopped shipments to the U.S. to avoid entanglement in geopolitics in recent months, two other sources familiar with the trade said. One cited four instances where Chinese firms declined to send material for fear it could be resold to banned users.
Reuters was unable to determine the total number of Chinese suppliers who had refused to move shipments destined for U.S. clients.
A U.S. official speaking on condition of anonymity told Reuters that the administration continues to press Chinese counterparts to address China’s lack of compliance with the Busan agreement, as well as other bilateral concerns.
While exports of many rare earths or related magnets have rebounded since China imposed restrictions in April 2025, the prices of certain rare earths and critical materials like yttrium, indium phosphide and tungsten that have military applications or are used in sensitive industries including aerospace or chipmaking remain near record highs with tight supply.
Exports to the U.S. of yttrium have risen this year but are still only about half 2024 levels despite large shipments to other countries, Chinese customs data shows. Some U.S. companies have been waiting more than six months for mineral licences, said two of the sources, declining to identify them.
Beijing said its August decision to sanction the RBA and other U.S. auditing firms was a response to a series of FCC restrictions since December targeting Chinese electronics testing labs, drones, consumer routers, submarine cables, advanced robotics equipment and power inverters.
However, after two months without yttrium exports, China sent 27 tons of the material to the U.S. in July, the second-highest monthly shipment since January 2025.
Several U.S. firms also report recently receiving multiple licences after long waits, two sources said, with some firms anticipating an increase in approvals around the summit.
Licence approvals are even more limited for Indian and Japanese buyers, two sources familiar with the matter said. Chinese suppliers are overwhelmingly refraining from shipping material to Japanese firms, one of them said.
https://www.reuters.com/business/aerospace-defense/china-rare-earth-firms-halt-some-us-shipments-over-geopolitical-worries-sources-2026-09-04/
