Chicago – September 17, 2025
European companies are preparing for further production shutdowns and significant losses as China persistently enforces strict controls on rare earth exports.
This situation persists despite a July agreement made during the EU-China summit, where China promised to expedite export licenses for critical raw materials destined for European firms, according to the European Union Chamber of Commerce in China.
Jens Eskelund, president of the chamber, highlighted ongoing severe bottlenecks affecting member companies, emphasizing that the July commitments have yet to translate into meaningful improvements. European automakers and semiconductor manufacturers have faced delays and widespread production halts due to China’s tight grip on rare earth elements, which are essential for automotive, defense, and technology sectors.
China dominates the refining and processing of these minerals, justifying its export restrictions as non-discriminatory.
However, fewer than 25% of the approximately 140 export license applications tracked by the chamber have been approved, signaling a protracted challenge for European industries. With approvals slowing, more shutdowns and financial impacts are expected in the coming months, underscoring the urgency for the EU to diversify rare earth supply chains.
