China’s Rare Earth Magnet Exports Continue Decline Amid US Supply Chain Efforts
China’s exports of rare earth permanent magnets to the United States continue to fall, as Washington and its allies accelerate efforts to diversify critical mineral supply chains. The decline underscores growing trade friction and Beijing’s tightening export controls.
Seventh Consecutive Monthly Decline
Shipments of permanent magnets to the US totaled 994 tonnes in January and February 2026, a decrease of nearly 22.5% compared to the same period in 2025, according to data released by China’s General Administration of Customs [1]. This marks the seventh consecutive month of decline.
Shifting Export Destinations
Over the first two months of 2026, the US was China’s third-largest buyer of rare earth magnets, following Germany and South Korea, accounting for 9.2% of total exports. Meanwhile, exports to the European Union have been on the rise, reaching 4,775 tonnes – a 28.4% increase year-on-year – increasing the EU’s share of China’s magnet exports to 44.4% [1].
China’s Dominance in Rare Earths
China maintains a near-monopoly on the global supply and processing of rare earth elements, which are essential components in a wide range of high-tech products, including electric vehicles, smartphones and spacecraft [4]. Permanent magnets, heavily reliant on these elements, are experiencing particularly strong demand.
Recent Restrictions and US Response
In 2025, China implemented and subsequently eased a series of export restrictions on specific rare earth magnets and metals [3]. These actions prompted concerns about supply disruptions and fueled Washington’s push to diversify its sources. The US government has indicated it may assert jurisdiction over technologies used in the rare earth supply chain [2].
Previous Export Trends
Prior to the recent declines, China’s rare earth magnet shipments to the US had experienced a brief recovery starting in June 2025, following trade talks between US and Chinese officials in London, where Beijing agreed to expedite export permits. But, tighter scrutiny of export license applications began in September 2025 [4].
Strategic Importance of Rare Earth Magnets
Rare earth magnets are vital for numerous technologies, including electric vehicles, renewable energy systems, electronics, and defense applications. China’s dominance in this sector, controlling approximately 90% of the market for both production and refining, gives it significant leverage [4].