PORTALBERITA.CO.ID - The prevailing strategy in Washington regarding critical minerals has long focused on resolving domestic bottlenecks, such as expediting permitting processes and increasing capital investment, assuming the global market would then self-correct. This economic perspective, however, fundamentally misunderstands the geopolitical reality of the trade, according to expert analysis.
Historically, the global critical mineral trade has been characterized by strategic market interference, where deliberate overproduction and dumping were used to eliminate nascent competitors before they could achieve scale. Once rivals failed, prices would rebound, reinforcing dependence on the dominant supplier, namely Beijing.
A significant shift is now underway, as China is reportedly moving beyond mere price manipulation to actively curtailing raw material exports by design. This action reflects a fundamental change in strategic focus from generating commodity export revenue to securing domestic industrial supremacy.
The economic rationale behind this shift is clear: a kilogram of refined dysprosium powder yields modest returns, whereas that same material, incorporated into an electric vehicle motor, substantially contributes to the value of a high-priced finished automobile. Countries aspiring to industrial leadership prioritize the sale of finished goods over raw commodities.
This policy materialized sharply on April 4, 2025, when Beijing imposed mandatory export licensing on seven key heavy rare earth elements, including terbium, dysprosium, and yttrium, leading to immediate production cuts by several international automakers shortly thereafter.
In October 2025, these controls were broadened to encompass five additional elements, although a subsequent partial suspension in November only applied to the October expansion, leaving the original April restrictions intact. Terbium, dysprosium, and yttrium still require case-by-case approval from the Ministry of Commerce for every shipment, with approvals for defense-related uses largely withheld.
Defense aerospace consultant Kevin Michaels noted that the supply chain issue has not been resolved, telling Politico’s NatSec Daily, "Yttrium is used in almost every jet engine, and manufacturers have been finding caches of suppliers here and there and are doing workarounds, but the yttrium has not started flowing from China yet." Bradley Martin of RAND interpreted this continued slowdown as a deliberate signal rather than a logistical error.
Mark Smith, Chairman and CEO of NioCorp Developments, which is working to launch a rare earth mine in Nebraska, asserts that the evidence points toward Beijing reserving these materials for domestic manufacturing rather than continuing to supply Western industries. "Some Western leaders keep treating each new Chinese export restriction as a bargaining chip," Smith wrote recently, "That is the wrong way to read what is happening."
This strategy aligns precisely with the stated ambitions of "Made in China 2025," which explicitly aimed to control the entire value chain, an objective Beijing has spent the last decade building the necessary supply infrastructure to achieve. Price discrepancies confirm this structural bifurcation, as dysprosium oxide traded significantly lower domestically ($191/kg) than for export ($317/kg) as of early 2026.
