China’s Commerce Ministry added ten US entities to its export control list on June 22, citing ties to the US military. This act follows Washington's recent expansion of its Chinese Military Companies list.
Among those targeted are MP Materials and USA Rare Earth, key players in building a domestic rare earth supply chain. Other firms affected include defense contractors Aveox and Oshkosh Defense.
China also restricted government procurement from 46 additional US firms, including Lockheed Martin, Raytheon, and Boeing’s defense division.
Beijing controls about 60% of global rare earth mining and over 90% of processing capacity. This leverage positions rare earths as a significant economic weapon amid rising trade tensions with the US.
The current restrictions escalate prior measures on heavy rare earths and magnets, naming US companies involved in this critical sector. MP Materials operates the Mountain Pass mine in California, the only significant rare earth mining site in the US, while USA Rare Earth is developing domestic processing capabilities.
Many firms on the list have been diversifying away from Chinese materials to mitigate potential retaliation. The procurement ban adds legal and reputational complications for firms such as Lockheed Martin and Boeing, complicating their already strained relations with China.