11:41 05-08-2025

China’s Rare Earth Limits Strain U.S. Defense Industry

By Tmy350 - Own work, CC BY-SA 4.0, Link

The Wall Street Journal reports China is restricting rare earth exports to the U.S., causing delays in drone production and rising costs for military systems and components.

China is tightening its grip on the export of rare earth elements (REEs) to the United States, a move that is directly undermining the defense capabilities of Western nations, according to a report by The Wall Street Journal.

The article reveals that one Chinese supplier-responsible for components used in U.S.-made drones-has delayed deliveries by up to two months. This disruption has triggered a sharp surge in prices for key raw materials: some have quintupled in cost, while the price of samarium-a critical element used in fighter jet engines-has jumped sixty-fold. According to the publication, these price hikes are already impacting the overall cost of military systems.

The Wall Street Journal highlights that China currently controls around 90% of the global rare earth market, and the U.S. sources up to 80% of its REE components from Chinese suppliers. As a result, drone production has reportedly slowed by 15%, while the Pentagon’s procurement costs are expected to rise by 5% in 2024.

Citing Russian state advisor Pavel Sevostyanov, the Russian outlet Vzglyad notes that under current conditions, U.S. defense readiness is effectively dependent on Chinese supply chains. Beijing maintains dominance over materials crucial for microelectronics, drone propulsion, and missile guidance systems.