Western companies that are dedicated to the extraction and processing of critical minerals are between the sword and the wall. These raw materials They are fundamental for many strategic industriessuch as those of semiconductors, telecommunications, advanced weapons or electric car, so USA and China are using them as a resource to exert pressure on the other.
This situation represents a very serious problem for Western mining companies because Donald Trump’s government has imposed very strict controls to China of these minerals, as well as High tariffs. Rio Tinto and BHP are the world’s largest western miners, and its best client is China. In fact, According to Volt Rush In 2024, 57% of Rio Tinto’s income came from China compared to 16.7% of the US.
Losing the Chinese market is not an option for these companies, so the managers of the two companies I just mentioned have met with President Donald Trump in the White House with the purpose of defending their interests and protecting their position in China. However, they also have something to offer to the Administration: the possibility of reinforcing the US supply chain by opening new deposits in the country, such as the “Resolution Copper” project of Arizona, delayed for years due to the opposition of the Apache tribe of San Carlos.
China dominates an essential market for the US and its allies: that of rare earths
On April 4, just 24 hours after Donald Trump announced the taxes that he was going to apply to the importation of most products from abroad, The administration led by Xi Jinping responded. And he did it forcefully. In early December 2024 He chose to prohibit The export of some critical minerals to the US, among which were three essential metals for the chips industry: Gallium, Germanio and Antimony.
Shortly after the Chinese government added two more critical metals to its list of export restrictions: the Scandio and the Disposio. These chemical elements are probably less known than metals prohibited by China previously, such as Gallium or Germanio, but They are at least so important Like the latter because they have a fundamental role in the industries of integrated circuits, telecommunications and the manufacture of storage devices.
Many companies have high -power magnet reservations made with rare earths, but possibly they will only allow them to subsist a few months
The ability to put pressure from China had not yet been extinguished. Just ten days later, on April 14, the Administration did not hesitate take another step forward With the purpose of putting in check, in addition to the industries that I just mentioned, those of electric cars, aeronautics and advanced armament. To achieve this, it effectively suspended, in addition to the export of the most valuable rare earths, that of high -power magnets that have a critical role in the industries that I have cited in this same paragraph.
Chinese authorities are retaining in ports throughout the country not only rare earths, but also high -power magnets acquired by electric cars manufacturers throughout the planet, aerospace companies, chip factories and armament companies. Many of these organizations They have high -power magnet reservations Made with rare earths, but possibly they will only allow them to subsist a few months.
Europe in particular is in an extremely delicate position. China’s export controls are directed mainly to the US, but the old continent It does not remain unscathed. At least for the moment. In fact, in Germany, which as we all know is the heart of the European car industry, There are already experts who assure that if China continues to retain rare earths and electric motors some essential parts of the electric cars production chain will stop in a few weeks. For the European car industry this blow would be very difficult to fit.
European companies that are dedicated to the manufacture of semiconductors are also in a very compromised situation. According to Reuters Many European chip production lines They will stop very soon Due to the shortage of crucial supplies, which has led the European Chamber of Commerce to meet with officials of the Ministry of Commerce of China to ask them to allow rare earth supply to European companies that are dedicated to the production of integrated circuits.
Image | Volker Braun | Gage Skidmore
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