Rare earth metal producers rose in price due to the dispute between the US and the PRC. Who is the favorite?

Shares in Australian companies that mine rare earth metals rose after China tightened export controls on these resources, escalating trade tensions with the United States. Beijing now requires export licenses for goods containing even small amounts of rare earth elements. Amid Donald Trump's threats to impose an additional duty on Chinese imports in response, investors began buying shares of companies that can replace Chinese supplies.

Shares of rare earth producers surged after Beijing tightened export controls on the strategic resource, and U.S. President Donald Trump responded by threatening to impose an additional 100 percent levy on China, CNBC reports.

Shares of Australian mining companies remain among the best dynamics this year, according to data compiled by Bloomberg. Quotes of Arafura Rare Earths, developing a deposit in the north of the country, rose on October 13 by 27%, reaching a maximum for more than two years. Securities Lynas Rare Earths, one of the world's largest producers, rose by 8.5%, Iluka Resources - by 6.3%, and Australian Strategic Materials - a record 42%.

The new round of confrontation reinforces the desire of the U.S., Australia and their allies to create an alternative supply chain for rare earth metals important for the production of electric cars, batteries, semiconductors and weapons. China controls more than 70% of global mining and processing of these elements, MarketWatch recalls. Australia is now considering creating a strategic rare earth reserve worth A$1.2 billion ($782 million) along with other measures as part of an agreement with the U.S., The Age wrote Sunday, citing a leaked internal report.

Shares of Chinese players also rose on Monday, despite a general decline in the stock market due to a new wave of trade tensions. Quotes of magnet manufacturer JL Mag Rare-Earth added 17%, China Northern Rare Earth Group High-Tech - almost 10%, and China Rare Earth Resources and Technology - 8.7%.

The US and China are once again on the brink of a trade war after Donald Trump threatened to impose massive duties on Chinese goods in response to Beijing's increased export controls. Trump said China was "holding the world hostage" and promised to take "financial countermeasures," CNBC reported.

The new rules announced by the Chinese authorities suggest that a license will be required to export any goods where the share of rare earth elements is 0.1% or more of the total value, MarketWatch recalls . Permits will also be required for companies using Chinese technologies for mining, processing or recycling magnets. The measures effectively extend April's restrictions, when China first threatened industry disruption by restricting exports of seven types of rare earth metals and goods that contain them.

This article was AI-translated and verified by a human editor