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Donald Trump refrains from taxing rare earths

The trade war is still hardening between China and the United States. Washington has just imposed 10% of taxes on $ 200 billion of additional imports from China, but nearly 300 Chinese products were finally spared. These include rare earths with some other minerals and metals strategic to the United States that are part of these exceptions.

Donald Trump refrains from taxing rare earths in China. This family of metals has finally disappeared from the list of products subject to US trade retaliation. In the same way as car seats, Bluetooth tools or connected watches, rare earths and some products containing them will therefore be spared by the new taxes of 10% and then by 25% on some 6,000 Chinese products.

China still supplies nearly 80% of the US rare earth supply. The term refers to 17 metals, including cerium used in petroleum refining, or neodymium and praseodymium essential to permanent magnets of wind turbines or radars in the military. These industries could very badly accuse the blow.

Cobalt substitute

It is also the rise of the American electric car that could be compromised. The champion in the field, Tesla, has recently reoriented to neodymium electric batteries, a rare earth imported from China, to avoid relying too much on cobalt from the Democratic Republic of Congo.

The United States therefore remains ultra-dependent on rare earths in China. They have tried to revive their own production, which has declined since the 80s. But the price bubble of 2010, which would have made the US mining projects profitable again, quickly burst when China gave up its embargo. Since then, prices have been divided by five. The American Molycorp went bankrupt, it was also bought by MP Mine Operation, financed by ... a Chinese investor.

American fragility

The United States therefore needs to import Chinese rare earths or rare earth components, even if they do not want to, since last month they banned the purchase of Chinese magnets for American army.

By removing from their list of taxed products rare earths, but also graphite, increasingly used in batteries, or antimony, an anti-fire mineral produced almost exclusively in China, the United States finally point to fragility which could later be exploited by the Middle Kingdom.

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