#TradeWar: #US Risks ‘Devastating’ Blow From #China’s Rare Earths Monopoly
(Bloomberg) — Beijing’s threat to use its dominance of rare earths in the trade war risks serious disruption to U.S. industry, by starving manufacturers of components commonplace in everything from cars to dishwashers and military equipment. And, it’s a stranglehold that might take years to break.
China could wreak maximum havoc by squeezing supplies of the magnets and motors that use the elements, said Jack Lifton, co-founder of Technology Metals Research LLC, who’s been involved with rare earths since 1962. The impact on American industry could be “devastating,” he said from Michigan.
“There is no such thing as an automobile sold in the U.S. or made in the U.S. that doesn’t have rare-earth permanent magnet motors somewhere in its assembly,” Lifton said. “It would be a tremendous hit to the consumer appliance industry and the automotive industry. That means washing machines, vacuum cleaners, cars. The list is endless.”
Beijing is gearing up to use the minerals as a counter in its trade battle with Washington, according to a salvo of media reports in China on Wednesday, potentially exploiting U.S. reliance on China for about 80% of its supply. It would represent a significant escalation in a trade dispute that has already roiled markets and threatened global growth.