U.S. companies face persistent China critical minerals constraints, USCBC says

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US critical minerals constraints

Highlights

US-China Business Council survey shows 38 companies affected by Chinese rare earth export controls, with 29% shifting suppliers and 47% seeking alternatives.
Rare earth elements such as samarium cobalt magnets, yttrium, and cadmium remain nearly unobtainable for U.S. firms despite an October agreement to ease export restrictions.
Only 49% of 134 surveyed companies plan to invest in China this year, citing ongoing mineral supply risks and unfavorable conditions for foreign businesses.

Survey findings on mineral access

As reported by the U.S.-China Business Council, some rare earth elements remain "nearly unobtainable" for U.S. companies despite limited progress on access. The group said its annual member survey, conducted in February and March, shows confidence in longer-term supply remains low.

According to the survey, 38 companies say they are affected by the restrictions. Of those, 29% say they are actively shifting to non-Chinese suppliers of critical minerals, while 47% say they are searching for alternatives but have not yet found viable replacements.

China introduced the controls in April 2025 in retaliation for tariffs imposed by U.S. President Donald Trump. The measures tightly restrict exports of certain rare earths that are important for advanced manufacturing, and they remain a major bottleneck despite an October agreement with Chinese President Xi Jinping that the White House says would "effectively eliminate" current and proposed export controls.

USCBC President Sean Stein says samarium cobalt magnets, used in high-temperature aerospace and defense applications, as well as yttrium and cadmium, are still very difficult for U.S. companies to obtain. Kyle Sullivan, the group's vice president, says securing finished rare earth magnets, not only the minerals themselves, is also challenging because China dominates both mining and processing.

Investment and supply chain implications

Stein says Beijing's policy is accelerating corporate efforts to diversify away from China, but he adds that fully resolving supply issues is likely to be difficult over the next three years even as Washington works to rebuild mineral supply chains in the U.S. and partner countries. He also says the issue points to a need for congressional involvement because the Trump administration alone cannot solve it.

Broader uncertainty in U.S.-China relations is also weighing on investment plans. The USCBC report says only 49% of 134 surveyed companies plan to invest in China this year, reflecting concerns that conditions for foreign businesses are not improving.

The business group says China's support for domestic companies, including industrial policy and preferential treatment in government procurement, is undermining the benefits of formal market-opening measures. That leaves manufacturers and downstream sectors exposed to continued supply risk in minerals and magnet inputs that are central to defense, aerospace and other advanced industries.

Our earlier article on the House Committee on Natural Resources’ land and energy package covered legislation linking federal land management to resource development, including new mineral leasing authority in Carlsbad, New Mexico. It also detailed measures tied to defense and regional priorities, such as expanding a military training area in Arizona and advancing a tribal land exchange in California—highlighting how domestic policy is being used to support energy and security objectives alongside access to strategic resources.

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