By DEYU WANG Dec 15, 2025
One of the most notable accomplishments of President Trump’s recent swing through China was his success in persuading China’s President Xi to liberalize export controls on rare earths. This was no small matter, as these minerals are fundamental to America’s economic and national security. But China’s weaponization of access to rare earths is a reminder of the country’s hostility to the United States and the risks in America being captive to Chinese products and companies.
“Rare earths” is a catch-all term for 17 elements (neodymium, praseodymium, etc.) that need to go through extensive processing — largely removing them from other minerals — so they can become high-value refined formats. Notably, China does 91% of the world’s rare earth processing, according to the International Energy Agency.
There is a long list of consumer products that are made with rare earths: smartphones, MRI scanners, cancer treatments, LED lights, wind turbines, and batteries in electric vehicles. They’re also essential for F-35 fighter jets, lasers, Tomahawk missiles, submarines, and satellites. They’ve been described as “the backbone of modern industrial supply chains.”
Alas, production of these and other products depends on having access to rare earths from other countries. And they’re heavily sourced from China — it accounted for 56% of U.S. consumption of rare earths from 2020–23, according to the U.S. Geological Survey. (The United States has only one rare earths mine — Mountain Pass in California.)
Such a high level of dependence on China leaves the United States highly exposed if bilateral trade tensions return, which is very likely. China could resurrect its original measure, which would have blocked companies connected to a foreign military from exporting any goods made with Chinese-originated rare earths.
Had that measure been in force for long, it could have been devastating for the United States. Because even before this ban had been announced, “the U.S. defense industrial base faced significant challenges and had limited production capacity and limited ability to rapidly scale to meet rising defense technology needs,” points out Gracelin Baskaran of the Center for Strategic and International Studies.
Baskaran has also warned that the new restrictions would “deepen these vulnerabilities, further widening the capability gap and allowing China to accelerate the expansion of its military strength at a faster pace than the United States.”
While the export ban has been lifted, China has a long history of manipulating the rare earths market. A recent U.S. congressional committee report assertsthat China has
“engaged in a decades‐long strategy to dominate the rare earth supply chain.” It did so by “luring in mostly western companies to collaborate with PRC companies, then selling products significantly below existing market participants’ prices to put competition out of business. Finally, after establishing its dominance, the PRC wielded this market clout as a geopolitical weapon.”
The committee also found that the Chinese government has worked to “manipulate” the price of rare earths — trying to keep them low in order to disincentivize Western companies from trying to enter the market.
Excessive dependence on rare earths is only one dimension of U.S. economic vulnerability to China. Another area is telecommunications.
A China-based company, Huawei, is the world’s largest manufacturer of telecommunications equipment. It is closely aligned with the government in Beijing, which has prompted policymakers to try to curb its use.
Recently, Bloomberg reported that the European Commission is likely to press member states to stop using Huawei equipment on their 5G and next-gen networks. The company has also been indicted in the United States on 16 counts.
In late June, the Trump administration moved to minimize Huawei’s heft in the United States by approving a settlement agreement so two of its U.S.-based competitors — Hewlett Packard Enterprises and Juniper Networks — could merge. A senior U.S. national security official told Axios: “In light of significant national security concerns, a settlement … serves the interests of the United States by strengthening domestic capabilities and is critical to countering Huawei and China.” The official said blocking the deal would have “hindered American companies and empowered” Chinese competitors.
Besides, rare-earth supply chains can only be rebuilt if the United States has strong downstream manufacturers whose scale justifies investment in domestic processing and magnet production. China dominates rare earths not only because it controls the mines, but because it also controls the downstream industries—EVs, wind turbines, smartphones, and data-center equipment—that create stable demand and keep processing profitable. By contrast, the U.S. has a mine at Mountain Pass but lacks enough downstream electronics and magnet producers to sustain a competitive ecosystem. A consolidated, more powerful HPE-Juniper strengthens America’s high-performance hardware sector, expands domestic demand for advanced components, and therefore helps create the market pull necessary to support U.S. rare-earth processing, magnet manufacturing, and other mid-stream capabilities. In this way, the merger indirectly contributes to reducing America’s long-term vulnerability to China’s rare-earth dominance.
China is in the midst of a multi-year, multi-dimensional campaign against the United States. That’s worrying, given the U.S. economic dependence on China. And that’s exactly why President Trump was right to strike an agreement that maintains access to China’s rare earths supplies.
But China is not to be trusted, and, in the longer term, the United States will need to find new sources for these elements.
Dr. Deyu Wang is a research fellow at Citizen Power Initiatives for China.