Crazy China prepares rare earths ban

Advertisement

The Communist Party of China has turned deeply irrational. We’ve seen it paint itself into a corner on a trade deal, massively overreach in Hong Kong and now it is readying to push the trade war into commodities. Via Zero Hedge:

During a Monday press conference, the Chinese NDRC said it was developing new state policies on rare earth metals, and intends to make them public as soon as possible.

According to Deutsche Bank, the key conclusion from the recent meetings is that Chinese authorities are preparing to limit shipments of rare-earth permanent magnets in addition to rare-earth elements, thereby closing off what was termed an “escape route” by the Global Times. Beijing’s veiled threats to restrict exports of rare earth metals to the US have been called by many as one of China’s nuclear options in a trade conflict with Washington. The US relies on China for about 80 percent of its rare earths supplies. The metals are used in everything from electric car motors and electronics to oil refining.

Advertisement

The full text of this article is available to MacroBusiness subscribers

$1 for your first month, then:
Cancel at any time through our billing provider, Stripe
About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.