China restricts rare-earth magnet exports

China is crafting a validated end-user (VEU) export system for rare-earth magnets and other sensitive materials, fast-tracking vetted civilian buyers while blocking firms with ties to the U.S. military, according to The Wall Street Journal and Reuters.

Beijing already accounts for more than 90% of processed rare earths and magnets. Tighter licensing since April has delayed shipments, creating shortages of high-performance NdFeB magnets used in electric vehicles, wind turbines, consumer electronics and advanced weapons systems.

The VEU model, reportedly patterned on U.S. export controls, would expedite licenses for approved buyers while excluding defense-linked customers. Reuters says some exporters have been told to prepare for one-year permits that could allow larger volumes but would keep broader controls in place. Key details on screening and eligible firms remain unclear.

U.S. officials say they aim to break China’s dominance within roughly 12–24 months, a timeline analysts call ambitious given the finance, permitting and workforce development required.

Private supply responses are already emerging: Solvay agreed to supply NdPr and DyTb oxides and samarium oxide to U.S. magnet makers, describing initial volumes as limited and expressing interest in building U.S. processing capacity if financial support improves. Manufacturers are accelerating efforts to diversify supply chains.