September 2010. Tokyo.

The calls started on a Tuesday. Rare earth shipments to Japan had stopped.

No announcement. No press conference. Just silence at the ports. Customs agents in China held the containers and wouldn't say why. Traders couldn't get answers. Within days, Toyota, Honda, and Hitachi — companies that built their factories around cheap Chinese rare earths — were calling each other in a panic.

The trigger was a fishing boat. A Chinese trawler had rammed a Japanese coast guard vessel near the Senkaku Islands. Japan arrested the captain. China wanted him back. And when diplomacy didn't work fast enough, Beijing reached for a weapon no one expected.

They turned off the rare earths.

The embargo lasted about two months. Prices spiked. The world panicked. Then it was over — shipments came back, prices fell, and most governments went right back to sleep. Japan spent the next decade saying it would build its own supply chain. It never did.

This week, China reached for the same weapon again. But the target this time isn't a customer. It's the two companies America built to break free.

On Monday, China's Ministry of Commerce added MP Materials and USA Rare Earth to its export control list. The order bars Chinese companies from selling them any dual-use goods or technology — the parts and machines you need to build a rare earth supply chain from scratch. Eight other U.S. firms, mostly in drones and aerospace, got the same treatment.

That means no Chinese-made processing gear, no rare earth chemicals from Chinese suppliers, and no technical help. For two companies trying to stand up new refineries and magnet factories from the ground up, those are the exact things they need.

The timing is not an accident. Five days earlier, the G7 agreed at their summit in Evian to cap rare earth imports from any single country at 60% by 2030. Days before that, the Pentagon added several Chinese companies to its own blacklist. Beijing's message is simple: if the U.S. tries to cut China out, China will cut back.

That's what makes this different from 2010. MP Materials runs Mountain Pass in California — the only rare earth mine in America. The Pentagon is its largest shareholder. USA Rare Earth just closed $1.6 billion in federal funding and picked a site in South Carolina for its first magnet plant. Both companies have spent the past year racing to build supply chains that don't run through Beijing.

And now Beijing is trying to make sure they can't.

The practical damage may be limited. Both companies have already been cutting their ties to Chinese equipment and parts. But the message matters more than the mechanics. In 2010, China proved it could use rare earths as a weapon. Sixteen years later, it's proving it will — and this time, it's aiming at the companies trying to take that weapon away.

G7 leaders agreed at their summit in Evian to limit rare earth and magnet imports from any single country to no more than 60% by 2030. After that, they want it down to 50%. The target is China, which handles about 70% of all critical minerals refining. But four years is not a lot of time. Many Western mining projects face money problems, permit delays, and years of construction before they can produce a single kilogram. One G7 official said countries will probably need to set rules for specific industries — defense first — to hit the number.

USA Rare Earth signed final agreements with the Commerce Department on June 3. The deal opens access to $277 million in grants and up to $1.3 billion in CHIPS Act loans. The same week, the company chose Cherokee County, South Carolina, for a $1.2 billion magnet factory — about 490 jobs. The plant will manufacture rare earth magnets and process refined metals, part of the company's mine-to-magnet supply chain spanning multiple facilities. The federal backing is the largest single investment in U.S. rare earth supply chains. That makes China's decision to blacklist USAR this week all the more pointed.

The Department of Energy picked two projects — one in Louisiana, one in Oklahoma — to pull rare earths out of industrial waste. The $134 million goes toward proving that coal ash, mine tailings, and e-waste can become a real source of rare earth metals at home. The idea: skip the mine, grab the metals from the stuff we already threw away. Research at Rice University showed that short bursts of extreme heat can break the mineral bonds that trap rare earths in waste material. That makes the chemical extraction step far cheaper and faster. If it works at scale, it could add a small but real stream of domestic supply without a single new mine permit.

Friedrich Merz, German Chancellor, G7 Summit in Evian
June 17, 2026

SAMARIUM

Every Tomahawk cruise missile has samarium inside it. So does every F-35 jet engine, every military satellite, and every precision-guided bomb. Samarium-cobalt magnets can take extreme heat — up to 350°C — without losing their strength. Standard neodymium magnets — the kind in your earbuds — start failing above 80°C, and even high-temperature grades used in EVs top out around 200°C. In a jet engine or a missile, that's a problem. Samarium costs just $9.77 per kilogram — a fraction of what neodymium or dysprosium cost. But China refines most of the world's supply. At that price, nobody else can make money producing it. The metal inside America's most advanced weapons depends on the country it's most likely to need them against.

China's Rare Earth Industry Association reported its price index hit 260.9 on June 17, using 2010 as a base year of 100. The index has risen about 65% from its early-2024 low. But China's pricing system remains opaque — state-controlled output quotas and export licenses make it hard for outside buyers to know what these numbers really mean.

— Rare Earth Exchanges

Greenland Mines hired Tetra Tech and geologist Ronald Simpson to produce a mineral resource estimate at its Sarfartoq rare earth project. The agreement was signed June 11. Western governments are eyeing Greenland as a potential non-Chinese source of both light and heavy rare earths.

— PR Newswire

Prime Minister Mark Carney and Chancellor Friedrich Merz issued a joint statement at the G7 pledging closer work on critical mineral supply chains. The agreement builds on a deal first signed in Berlin in August 2025. Both countries are trying to find rare earth suppliers that don't run through Beijing.

— Prime Minister of Canada

Metallium is running a multi-unit flash joule heating campaign at its Texas facility, using technology developed at Rice University, testing a process that uses short bursts of extreme heat to separate rare earths from scrap. The company says it could cut processing costs and remove the need for harsh acids.

— REEx Forum