What happened: Three incidents have raised suspicions that China could soon curb its exports of 17 rare earth elements, which are immensely valuable to technology manufacturers, as a retaliation in the US-China trade war. After President Xi Jinping visited rare earth mines and processing facilities last week, an official from China’s National Development and Reform Commission told CCTV that using rare earth minerals mined in China against them would displease the Chinese people. Another official told Xinhua News on Tuesday that the government would prioritize domestic demand of the precious materials. Hu Xijin, Editor-in-Chief of the Global Times, a newspaper that is close to the Communist Party, said on Twitter that given his knowledge, Chinese authorities are seriously considering this measure.

Why it’s important: China is by far the largest exporter of these precious raw materials, which are used in anything from iPhones to renewable energy solutions and oil refineries. China accounts for about 70% of global output of rare earths, and 80% of US imports. It would be almost impossible for the US to quickly find a replacement source which could supply the volume of rare earth imports it requires. US exports of processed rare earths to China are already facing a 25% import tariff, a similar measure that China took during another trade dispute with Japan in 2010.

Eliza was TechNode's blockchain and fintech reporter until July 2021, when she moved to CoinDesk to cover crypto in Asia. Get in touch with her via email or Twitter.

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