China Controls Trade Chokepoints Beyond Rare Earths. It's Squeezing Them: The 5 Critical Minerals China Is Using as Trade Weapons

That F-35 fighter jet humming on the tarmac? It needs rare earths for its radar and targeting systems. The electric vehicle in your neighbor's driveway? Its battery and motor depend on critical minerals. The smartphone you're probably reading this on? Same story.

Here's the uncomfortable truth: China controls the spigot for most of these materials.

And it's not just rare earths.

Over the past two years, Beijing has built a sophisticated export control machine that reaches far beyond the 17 rare earth elements. We're talking about gallium, germanium, antimony, tungsten, and graphite, minerals you've probably never thought about, but without which modern technology simply doesn't work.

China isn't just sitting on this dominance. It's actively squeezing.

Let's unpack what China controls, how the squeeze works, and what it means for everyone from defense contractors to EV buyers.

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Why Critical Minerals Are the New Oil

Here's a thought experiment. Imagine if one country controlled 90% of the world's oil refining. Now imagine that country started requiring export licenses for gasoline and jet fuel. Chaos, right?

That's essentially what's happening with critical minerals.

India's Economic Survey 2026 put it bluntly: "Who controls critical minerals could control the energy transition". The survey warned that metals like lithium, cobalt, nickel, copper, and rare earth elements are emerging as "strategic chokepoints affecting energy security, industrial competitiveness, and geopolitical power".

Critical minerals aren't niche anymore. They're the foundation of the green transition, defense technology, and the AI revolution. And China has built a fortress around that foundation.

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Beyond Rare Earths, The Full Chokepoint Map

When most people hear "China critical minerals," they think rare earths. Fair enough, China controls roughly 60% of mined rare earth output and a near-total 91% of global processing capacity.

But that's just the headline. The real story is in the supporting cast.

Gallium and Germanium, The Semiconductor Staples

Gallium is used in integrated circuits, LEDs, and photovoltaic panels. China accounts for 94% of global production. Germanium is essential for fiber optics and infrared systems. China produces 83% of it.

Think about that for a second. Nearly all the gallium and germanium on Earth passes through Chinese hands.

In December 2024, China banned exports of these metals to the United States. That ban was later suspended until November 2026 as part of a trade truce, but the suspension expires soon, and the regulatory framework remains in place.

Antimony, The Fire Retardant and Explosives Mineral

Antimony is used in fire retardants, batteries, and, here's the defense angle, explosives and armor-piercing ammunition. China, Russia, and Tajikistan together account for over 90% of global mine production.

China began restricting antimony exports in September 2024 and tightened those restrictions in December 2024, targeting exports to the US specifically.

Tungsten, The Armor-Piercing Metal

Tungsten has the highest melting point of any element. It's used in armor-piercing ammunition, cutting tools, and high-temperature applications. China added tungsten products to its export control list in February 2025 and now limits exports to just 15 approved companies.

Graphite, The EV Battery Backbone

Graphite is the largest component of lithium-ion battery anodes, the stuff that makes your EV go. China subjects graphite shipments to "stricter reviews of end-users and end-uses". New controls on synthetic graphite anode materials took effect in November 2025.

The "Other" Rare Earths

Beyond the well-known light rare earths (neodymium, praseodymium), China has tightened controls on medium and heavy rare earths, the ones that are hardest to source elsewhere. In April 2025, China imposed export licensing on seven heavy rare earth elements including terbium, dysprosium, and yttrium. A second, broader wave followed in October 2025.

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By the Numbers, China's Dominance in One Chart

Let me hit you with some numbers that should make any supply chain manager lose sleep:

The International Energy Agency put it starkly: "For a remarkable 19 out of 20 important strategic minerals, China is the leading refiner". And this concentration "has only intensified in recent years".

Goldman Sachs warns it could take the West up to ten years to challenge China's dominance in rare earths. Ten years. That's not a gap, that's a chasm.

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How the Squeeze Works, China's Export Control Playbook

So how does China actually pull this off? It's not just about having the minerals. It's about controlling the entire value chain.

The Two-Wave Strategy

Wave one came in April 2025. China imposed export licensing requirements on seven medium and heavy rare earth elements, terbium, dysprosium, yttrium, and others. This was widely seen as retaliation for US tariffs.

Wave two hit in October 2025. This was the big one. China expanded controls to cover not just rare earth elements, but also associated mining, processing equipment, and technologies. The new rules covered everything from centrifugal extraction equipment to permanent magnet forming presses.

Extraterritorial Reach, The Game Changer

Here's where it gets really clever, and really concerning for global supply chains.

China explicitly applied extraterritorial controls to rare earth elements. That means:

• De Minimis Rule: Any foreign-produced item containing Chinese-origin rare earths representing at least 0.1% of the item's total value is subject to Chinese export controls

• Foreign Direct Product Rule: Items manufactured abroad using Chinese-origin rare earth mining, smelting, or magnet manufacturing technologies are subject to Chinese controls

Sound familiar? It should. These rules are modeled on the US Foreign Direct Product Rule that Washington has used to restrict China's access to advanced chips. China turned America's own playbook against it.

Licensing as Leverage

Even when controls are "suspended," the licensing infrastructure remains. China can flip the switch back on at any moment. The October 2025 controls were suspended as part of a trade truce, but "the regulatory structure remains in place for potential reactivation".

Think of it like a dam. The water might be flowing now, but the gates are still there, and China controls the lever.

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Real-World Impact, Prices, Shortages, and Shutdowns

This isn't abstract geopolitical theory. The squeeze is already hitting wallets and factory floors.

Price Explosions

Since the April 2025 controls took effect:

• Yttrium prices have risen roughly 15-fold
• European rare earth prices reached up to six times those in China
• Exports of yttrium, dysprosium, and terbium are running at just 42%, 41%, and 49% respectively of pre-restriction volumes

Let that sink in. Some of these materials are now 15 times more expensive than they were a year ago. That cost gets passed down, to defense contractors, to automakers, and eventually to consumers.

Production Shutdowns

The impact isn't just theoretical. When China introduced export controls in April 2025, "many carmakers in the United States, Europe, and elsewhere struggled to obtain permanent magnets, with some forced to cut utilization rates or even temporarily shut down factories".

The Center for Strategic and International Studies noted that China held 99% of global heavy rare earth processing capacity as recently as 2023, with the only non-Chinese refinery, a small facility in Vietnam, currently offline.

There's simply no quick alternative to plug the gap.

Semiconductor and AI Disruption

The restrictions on gallium and germanium "could disrupt supply chains for semiconductors," while limits on graphite exports "may hit battery production for electric vehicles and fuel cells". Yttrium shortages are "threatening capacity expansion" for semiconductor and AI data center companies.

This isn't just about one industry. It's about everything that runs on chips, batteries, or advanced manufacturing.

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The Trump-Xi Summit, A Truce, Not a Solution

In October 2025, President Trump and President Xi met in South Korea and agreed to walk back some punitive measures. The headline was a suspension of export controls. The reality is more complicated.

What China agreed to:

• Suspend the October 2025 export controls for one year
• Issue "general licenses" for gallium, germanium, antimony, tungsten, and graphite

What China didn't agree to:

• Permanently eliminate the controls
• Remove the regulatory infrastructure
• Address the April 2025 controls on heavy rare earths

The suspension expires in November 2026. After that, China can, and many analysts expect it will, reinstate the restrictions.

The White House said only that Beijing had committed to "addressing U.S. concerns over supply shortages", without offering specifics or a timeline.

BMI, the Fitch Group research unit, said China's "stranglehold on global rare earth supply is expected to 'stay firmly in place'" following the summit.

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Can the West Catch Up?

The short answer: Not quickly.

Goldman Sachs warns it could take the West up to ten years to challenge China's dominance in rare earths. The IEA's Global Critical Minerals Outlook 2025 showed that supply concentration has actually intensified in recent years.

What the US Is Doing

Washington is moving fast, though the gap between announcements and actual supply remains significant:

• Pentagon: Took a $400 million equity stake in MP Materials (the only US rare earth miner), the first investment of its kind in Pentagon history
• USA Rare Earth: Received a $1.6 billion funding commitment from the government
• Apple: Committed $500 million to buying domestically made rare earth magnets
• Australia: Signed an agreement backed by an $8.5 billion project pipeline and a proposed strategic reserve for rare earths and lithium

The Processing Problem

Here's the catch: mining is only half the battle. Processing is where China's real dominance lies.

China processes 91% of global rare earth production. Building new processing facilities takes years, requires specialized expertise, and faces regulatory and environmental hurdles.

"The real pinch point is processing, refining and qualification," said Charles Altshuler, interim CEO of Globe Metals & Mining Ltd.

For heavy rare earths like dysprosium and terbium, the ones essential for high-performance magnets in EVs and defense systems, the situation is even more acute. "Crucial, but small volumes of rare earth materials made from heavy rare earths like dysprosium" have effectively dried up because of China's dual-use restrictions.

Here's the bottom line: China has built something unprecedented.

It's not just that Beijing controls the minerals. It's that China controls the entire ecosystem, mining, processing, magnet manufacturing, and now the regulatory framework to restrict exports extraterritorially.

The October 2025 controls were suspended, not eliminated. The regulatory structure remains in place. The April 2025 controls are still active. And the November 2026 expiration date looms.

For businesses, this means supply chain risk is now a permanent feature, not a temporary disruption. For governments, it means critical minerals are a national security priority, not just an economic concern. For consumers, it means the cost of everything from EVs to smartphones could rise, and stay high.

The question isn't whether China will use this leverage again. It's when.