Beijing could be preparing a retaliatory action against Washington as a fallout of worsening trade difference dispute between the two World powers. Specifically, the China is mulling curbing export of critical Rare earths minerals in a targeted way that could hurt the U.S. economy, Bloomberg reports. The actions are targeted at heavy rare earths, a sub-group of the rare earth materials where the U.S. is particularly reliant on China, and could be implemented as soon as the Government decides to go ahead, the report further stated.
The potential use of the strategic Rare earths as a trade weapon could mean a big blow to the US economy given its importance and its over reliance on China for same products. China is by far ahead of other countries accounting for 80% of the world’s rare earths, only followed by Estonia which boasts of just 6%.
Racket Hu, a researcher at Shanghai Metals Market is of the believe that restricting or placing a ban on Rare earth minerals to the U.S could result to a spike in prices of the minerals, citing the scenario that played out in 2010 when China curbed shipments to Japan. It could also mean a clear signal that clearly signal that trade tensions are escalating with no truce in sight.
Rare earths—17 in number— are not especially rare, but they tend to occur together in nature and are difficult to separate from one another. They are as common as copper and lead, and are vital to much of today’s tech with uses in every segment from consumer electronics to national defense.