Latest news with #exportcontrols
Yahoo
4 hours ago
- Automotive
- Yahoo
Could China's rare earth pivot ease strain on the automotive sector?
China has approved a number of rare earth export licences, a move that could provide modest relief to global manufacturers struggling with supply disruptions. But with export volumes still sharply down and no transparency on which firms benefit, Europe's automotive industry remains vulnerable to further disruption. At a press conference on Thursday, China's commerce ministry confirmed it had approved 'a certain number' of export licence applications for rare earths and magnets. These minerals are used in an array of high-tech products such as smartphones and jet engines. Rare earths such as neodymium, dysprosium and terbium are indispensable for producing lightweight, high-efficiency motors in electric and hybrid vehicles. China's announcement follows months of tension sparked by Beijing's decision in April to impose new export controls on seven rare earth elements and related products — just days after Washington introduced steep tariffs on Chinese goods. According to commerce ministry spokesperson He Yadong, China will 'continue to strengthen the review and approval' of licence applications and remains 'willing to enhance communication and dialogue' on export controls. The updated tone from Beijing also arrives just weeks before a major EU-China summit set for 24 to 25 July in Beijing, commemorating 50 years of diplomatic relations. Chinese customs data shows the stark impact of the restrictions. Exports of rare earth magnets plunged 74% in May compared to a year earlier, the steepest drop in over a decade. Shipments to the United States fell by 93%, according to a Wall Street Journal analysis. Total export volumes for May stood at just 1.2 million kilograms, the lowest since the start of the COVID-19 pandemic in early 2020. Earlier April exports also dropped by 45% year-on-year. Related EU Decoded: Is the EU losing the geopolitical race for critical raw minerals? From lithium to rare earths: Europe's strategy to power its future energy JL Mag Rare-Earth, a major Chinese magnet supplier to Tesla, Bosch and General Motor, said last week that it had begun receiving licences for shipments to the US, Europe and Southeast Asia. Since April, hundreds of export licence applications have been submitted to Chinese authorities, but only about one-quarter have reportedly been approved. Some firms have encountered requests to disclose IP-sensitive information, while others have faced outright rejections based on unclear procedural grounds. ING economist Rico Luman indicated that with 'nearly 70% of global rare earth production and more than 90% of processing taking place in China, the world remains heavily reliant' on the country. Though rare earths are not geologically scarce — cerium, for instance, is more abundant than copper — their extraction is costly, and mineable concentrations are rare. "It's not a question of scarcity, but of concentration," Luman added. China also supplies more than 90% of the world's demand for rare earth permanent magnets, frequently used in electric motors and wind turbines. Without access to these materials, the European automotive supply chain risks paralysis. The automotive sector relies heavily on rare earth magnets for electric motors, power steering, sensors and other components used in both combustion and electric vehicles. 'China's export restrictions are already shutting down production in Europe's supplier sector,' Benjamin Krieger, Secretary General of CLEPA, warned earlier this spring. His call for 'transparent, proportionate' licensing remains relevant, even as some licences begin to clear. The European Chamber of Commerce in China confirmed that while some progress has been made, challenges persist. 'The situation is improving, although the percentage of cleared licences does vary. Additionally, even once the licence is given, delays can still be seen in customs clearances,' said Adam Dunnett, the Chamber's secretary general. Beijing's latest move to ease export restrictions on key components for the automotive industry offers only limited relief to a sector under strain. The European automotive industry, already grappling with competition from lower-cost Chinese electric vehicles, remains vulnerable to material shortages, delays and discretionary actions from Beijing — thereby reinforcing China's leverage in global trade negotiations. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
South China Morning Post
13 hours ago
- Business
- South China Morning Post
Caught in the chip war, Malaysia must rethink its US–China balancing act
Malaysia has landed in another tight spot – this time over claims Chinese engineers may have accessed high-end Nvidia chips on its soil to train artificial intelligence models, potentially breaching US export controls. Advertisement The timing could hardly be worse. Trade Minister Tengku Zafrul Aziz and Second Finance Minister Amir Hamzah Azizan were in Washington this week to negotiate down a steep 24 per cent 'reciprocal tariff' imposed by US President Donald Trump in April. Now, their efforts risk being overshadowed by fears in Washington that Malaysia is serving as a backchannel for Chinese firms to access restricted chips – fears that could harden American attitudes and demands. The report, first published by the Wall Street Journal, claimed that an unnamed Chinese firm had booked out Malaysian data centres equipped with Nvidia's most advanced chips. US policy restricts the sale or export of these chips to China and its military-linked entities, including via third countries. A banner showing Nvidia branding at the AI & Big Data Expo 2025 in London on February 5. Photo: Reuters While it is unclear whether any laws were broken, the perception alone could prove damaging. Analysts expect Washington may use the case as leverage to push Malaysia into stricter enforcement of US export controls, especially given the billions of dollars in investments by American tech firms in Malaysian plants and data centres.
Yahoo
a day ago
- Business
- Yahoo
Malaysia, Singapore Probe Nvidia-Powered AI Exports
Malaysian and Singaporean authorities are probing whether Chinese firms breached U.S. export controls by funneling Nvidia (NASDAQ:NVDA)-powered servers through Southeast Asia to train AI models. Malaysian trade regulators say they're verifying reports that Chinese engineers flew into Kuala Lumpur last March with suitcases full of high-end Nvidia server hardware. Simultaneously, Singapore's law minister flagged a parallel fraud investigation: Dell (NYSE:DELL) and Super Micro (NASDAQ:SMCI) serverspotentially fitted with U.S.-restricted chipswere shipped from Singapore to Malaysia under possibly false destination claims. Warning! GuruFocus has detected 3 Warning Sign with DELL. These moves come amid shifting U.S. export curbs on advanced AI semiconductorsrestrictions that have swung between the Biden and Trump administrationsand scrutiny of startups like DeepSeek for allegedly sidestepping those rules via third-party routes. AI workloads depend on accelerators like Nvidia's GPUs, making access to these chips a national-security flashpoint. If export-control loopholes are widespread, they could undermine U.S. policy objectives, tighten hardware supply for legitimate buyers and force cloud and AI providers to rethink sourcing strategies. This article first appeared on GuruFocus. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
a day ago
- Business
- Yahoo
China has granted rare earth export licences to some firms, commerce ministry says
BEIJING (Reuters) -China's commerce ministry said on Thursday that "a certain number" of rare earth export licence applications had been approved, but declined to give further details such as the exact amount and how many had been extended to U.S. firms. "China will continue to strengthen the approval process for compliant applications, and is willing to further enhance communication and dialogue with relevant countries on export controls," He Yadong, a ministry spokesperson told a regular news conference.
Reuters
a day ago
- Business
- Reuters
China has granted rare earth export licences to some firms, commerce ministry says
BEIJING, June 19 (Reuters) - China's commerce ministry said on Thursday that "a certain number" of rare earth export licence applications had been approved, but declined to give further details such as the exact amount and how many had been extended to U.S. firms. "China will continue to strengthen the approval process for compliant applications, and is willing to further enhance communication and dialogue with relevant countries on export controls," He Yadong, a ministry spokesperson told a regular news conference.
