China Imposes Six-Month Limit on Rare-Earth Export Permits to US Automakers

China Puts Six-Month Cap on Rare-Earth Exports to US Companies

China has introduced a six-month limit on rare-earth export permits granted to US automakers and industrial manufacturers, according to a report by The Wall Street Journal on Wednesday. The move follows recent high-level trade negotiations in London, where a temporary suspension of the permit system was considered a breakthrough.

Temporary Win Undermined by Short Deadline

While the temporary cancellation of rare-earth permits was seen as a diplomatic success for the US side, the newly imposed six-month timeframe reveals the fragile and conditional nature of the agreement. This cap means the potential for renewed trade tensions remains high, especially in sensitive sectors like clean energy and electric vehicles, where rare earth elements are vital.

“The six-month window signals flexibility — but also leverage,” analysts suggest.

Why Rare Earths Matter

Rare earth elements are critical components in electric vehicles (EVs), smartphones, military equipment, and clean tech applications. China controls a dominant share of global rare-earth production, making its export policy a strategic trade tool.

The restriction introduces new supply chain uncertainty for US manufacturers and may push companies to diversify sourcing or ramp up domestic production efforts.

What’s Next in US-China Trade Dynamics?

The six-month limitation could serve as a pressure tactic by Beijing, offering it the flexibility to tighten or ease controls based on future negotiations. This development comes as broader geopolitical trade risks remain elevated between the world's two largest economies.

Key Takeaways:

• China sets six-month deadline on rare-earth export permits to US companies.
• Move follows recent trade talks in London.
• US automakers and manufacturers face renewed supply chain risks.
• Rare earths remain a critical bargaining chip in trade relations.
• Market uncertainty may rise as deadline approaches.

More Insights on Tredu.com:

• How Rare Earths Shape Global Trade Policy
• US-China Trade War: Timeline & Future Outlook
• EV Industry at Risk: Supply Chain Challenges in 2025