Rare-earth stocks surge as US-China trade spat intensifies
Shares of rare-earth producers jumped as investors reacted to renewed US-China tensions over tariffs and export controls. Arafura Rare Earths gained about 18% to a more than year high, and Australian Strategic Materials climbed roughly 30%.
Lynas Rare Earths rose about 3.7% and Iluka Resources advanced about 2.2%. MP Materials in the US, backed by Pentagon support, recently reached its highest close after earlier gains.
Several Chinese producers of magnets and rare-earth products also rose, with some gains in double digits. The move followed China’s decision to expand export curbs on rare-earth elements and products containing them — including provisions that could apply to goods sold worldwide.
Several Chinese producers of magnets and rare-earth products also rose, with some gains in double digits. The move followed China’s decision to expand export curbs on rare-earth elements and products containing them — including provisions that could apply to goods sold worldwide.
China supplies the majority of the world’s rare earths, used in electronics, defence and clean-energy technologies. Policymakers in Western countries have been pursuing ways to diversify supply chains and increase allied or domestic production.
In addition, Australia has committed $780 million to a Critical Minerals Strategic Reserve, and officials are now discussing industry contributions and a U.S. partnership.
Rare earths are used in electric vehicle motors, wind turbines and defence systems. Since April, prices and stocks moved higher after China imposed controls on several rare earths and related products.
Lloyd Chan, a strategist at MUFG Bank, described regional markets as being in a “risk-off” mood, noting that threats of large tariffs had renewed concerns about a trade escalation. He highlighted that currencies tied to export demand were under pressure.
An Asia dollar index already dropped about 0.2% to 91.51, its lowest level since early May. The Taiwanese dollar and the South Korean won were among the weakest emerging Asian currencies. The MSCI Emerging Markets index fell about 2%, the biggest one-day drop from April onward.
In addition, Australia has committed $780 million to a Critical Minerals Strategic Reserve, and officials are now discussing industry contributions and a U.S. partnership.
Rare earths are used in electric vehicle motors, wind turbines and defence systems. Since April, prices and stocks moved higher after China imposed controls on several rare earths and related products.
Lloyd Chan, a strategist at MUFG Bank, described regional markets as being in a “risk-off” mood, noting that threats of large tariffs had renewed concerns about a trade escalation. He highlighted that currencies tied to export demand were under pressure.
An Asia dollar index already dropped about 0.2% to 91.51, its lowest level since early May. The Taiwanese dollar and the South Korean won were among the weakest emerging Asian currencies. The MSCI Emerging Markets index fell about 2%, the biggest one-day drop from April onward.
