China blocks US access to critical minerals in retaliatory response to tariffs

In what is seen as a response to President Donald Trump’s new tariffs, China has moved to block the US and its allies from accessing essential critical minerals.

The Chinese move will reportedly affect critical minerals such as tungsten, tellurium, bismuth, molybdenum and indium, following a previous ban on gallium and germanium.

Analysts are suggesting the restrictions are targeting the US defence industry in particular.

‘Dual use’ minerals

Financial information and analytics firm S&P Global has reported that China said it would tighten the exports of five critical minerals, citing their ‘dual use’ and adding that such a move safeguards ‘national security and interests’.

S&P highlighted molybdenum – primarily used to make steel alloys and also utilised in other key critical sectors including the solar and aerospace industries – as a Chinese target.

The same molybdenum alloys can also be used to build military equipment.

Immediate impact

According to the country’s finance and commerce ministries, the export curbs will begin immediately, while the tariff imposition will come into effect on 10 February.

China is also reported to have added 28 US defence companies to its Export Control List, restricting their importation of “dual-use” technologies from China.

The government plans to impose an additional 15% tariff on coking coal and certain other types of coal imported from the US.

It is also expected to add new tariffs targeting US exports of liquefied natural gas, crude oil and agricultural farming equipment.

Market jitters

Meanwhile, looming discussions between President Trump and China’s President Xi Jinping are creating market jitters.

The US tariffs on Chinese goods in particular have sparked a surge in gold prices.

The precious metal touched another record high overnight, gaining as much as 1% to US$4,550 per ounce, with the market chasing safe-haven assets.