China’s 2025 REE Export Controls: 12/17 Elements – Global Consequences and Impact on Poland

Introduction: This REE Crisis Is Different from All the Previous Ones

The 2025 crisis differs from the 2010–2011 price shock and the tensions of 2020–2023 in one key aspect: this time China is not announcing a simple embargo, but building a sophisticated, multi-layered administrative machine. Export licenses, a ban on military applications, technology control and the ability to regulate products manufactured outside China create a system that can be loosened or tightened at will – depending on Beijing’s current goals.

The China Briefing article from November 2025 describes in detail how this mechanism works: which elements are controlled, in which forms (metals, alloys, oxides, magnets, targets), what the extraterritorial rules look like, and what this can mean for companies worldwide. Based on that – and on official MOFCOM notices plus independent think-tank analyses – we show the full picture of the situation, with a focus on the consequences for Poland.

1. April Controls (Announcement No. 18 of 2025) – 7 Elements under Constant Supervision

On 4 April 2025, China’s Ministry of Commerce (MOFCOM) published Announcement No. 18 of 2025, introducing export licensing for seven rare earth elements and their derivatives. According to China Briefing and the official text, every form of these REE – metal, oxide, selected alloys, targets, part of the magnets – now requires an export permit. Licenses are assessed based on, among other things, destination country, end-user and end-use.

Official documents state clearly that exports are prohibited for military applications, weapons of mass destruction, terrorism and situations where end-use / end-user cannot be reliably verified. China Briefing also notes that, in practice, companies must reckon with a processing time of up to 45 working days – which, in complex supply chains, means a real risk of delays and bottlenecks.

Table 1 – Seven Elements Subject to April Licensing

China Briefing also shows hard export data: after the April measures took effect, REE export growth in April was only 4.8% year-on-year (compared with much higher dynamics before), May saw a 5.7% decline, and only in June did exports spike by more than 60% – a consequence of clearing the licensing backlog. This is practical confirmation that the permit system is not a “formality” but a real tool for steering export volumes.

2. October Expansion – 12 of 17 REE under Control and the Stick of Extraterritoriality

On 9 October 2025, MOFCOM issued another regulation expanding the system to five additional elements: holmium (Ho), erbium (Er), thulium (Tm), europium (Eu) and ytterbium (Yb). As China Briefing stresses, after this change, exports of 12 out of 17 rare earth elements were subject to some form of licensing oversight. Importantly, the rules covered not only raw materials, but also selected advanced products, equipment and technologies.

The most sensitive part of the October package was extraterritoriality: products manufactured outside China that contain more than 0.1% by value of materials from specified lists (Lists 1–3) or are produced using Chinese separation/recycling technology would also require a Chinese export license. In other words – even if an NdFeB magnet is produced in Europe, but contains critical REE from China or is made on a Chinese separation line, Beijing reserves the right to decide who is allowed to export it further.

Table 2 – Five Additional Elements Covered by the Expanded Controls

Extraterritorial Lists – How China Reaches beyond Its Borders

China Briefing and Western law firms (Mayer Brown, Taylor Wessing) point out that the October package introduces three lists of related materials and products: a list of input materials (REE metals, alloys, oxides), a list of permanent magnets and a list of coating/plating targets. If the share of materials from these lists in a product made outside China exceeds the 0.1% threshold of final value, exports of that product could be subject to a Chinese license.

For Western companies this boils down to one thing: even if you “move” production outside China but still rely on Chinese raw materials or Chinese separation technology, you are not escaping at all. MOFCOM can switch on licensing mode at any time and demand end-use / end-user documentation even for products made in Estonia, Poland or the US.

3. Post Trump–Xi Suspension: What It Really Changed – and What It Didn’t

At the end of October 2025, a Xi–Trump meeting took place, after which China announced a one-year suspension of parts of the October measures. China Briefing explains that this means halting the application of the new, expanded measures – including some extraterritorial provisions – until 10 November 2026. It is an important course correction, but not the dismantling of the entire system.

The April licenses on seven elements remain in place. The ban on military/WMD applications and the requirement to verify end-users and end-use still apply. The suspension therefore does not mean a “return to normal”, but a postponement of the full version of the October package. Beijing keeps the option to reactivate all tools – in whole or selectively – if it sees an advantage in the tariff dispute with the US or in talks with the EU.

This is why many analysts (Benchmark Mineral Intelligence, Trivium China) talk about a one-year “window” for the West. During this time, it is still possible to look up from the slide deck and actually build alternatives: long-term contracts, domestic separation capacity, recycling and – most importantly – strategic stockpiles. Whoever wastes this pause will later pay the price set by those who used it well.

4. What the Biggest Players Are Doing – Tesla, Toyota, MP Materials, Lynas, Neo

To understand how seriously we should take Chinese controls, it is best to look at the behaviour of those with the most to lose – and the greatest ability to act. Tesla, Toyota, MP Materials, Lynas and Neo Performance Materials have assumed for years that China will use REE as a political tool. So they opted for brutal realism: contracts, their own plants, heavy-REE-lean technologies and state support measured in billions of dollars.

Tesla – Stockpiles, Own Separation, Less Dy in Magnets

Public Tesla filings and management statements show that the company has been aggressively hedging against Chinese restrictions for years. It has built NdPr and heavy REE stockpiles, signed contracts with non-Chinese suppliers and, in parallel, developed magnet technologies with reduced Dy content. In practice this means that each new generation of Tesla traction motors is less sensitive to Dy/Tb supply shocks.

Tesla is also betting on vertical integration in the US – building its own processing and magnet-making infrastructure with local partners. Detailed numbers differ between industry reports, but the trend is clear: Musk does not want the company’s future to depend solely on MOFCOM’s goodwill.

Toyota and the Japanese School: Dy/Tb-Free Magnets + State Stockpiles

After the 2010–2011 crisis, Japan was the first country to truly treat REE as an element of national security. Through its holdings and JVs with magnet producers, Toyota developed high-coercivity NdFeB magnets without Dy and Tb in some key models. In parallel, Japan built a state REE stockpile which, according to government data, can secure several months of critical consumption for selected sectors.

This is not theory on slides – it is a working system. When China announced new controls in 2025, Japanese firms already had signed contracts with non-Chinese suppliers, operating separation plants, recycling projects and warehouses. At the same time, Europe was still mainly discussing strategies and yet another “Critical Raw Materials Act”.

MP Materials, Lynas, Neo – the West’s Pillars outside China

MP Materials in the US, Lynas in Australia and Neo in Estonia are the trio on which the West is trying to build an alternative to Chinese dominance. Stock-exchange filings and analyses show that NdPr separation capacity – and, to a limited extent, heavy REE production – is growing, but still far from offsetting China’s share. Adamas Intelligence estimates that even if all currently planned projects are completed, Dy and Tb deficits will remain significant in 2030.

At the same time, it is clear that the largest corporations (Tesla, Toyota, big automotive and energy groups) reserve a large part of Lynas, Neo and MP capacity through long-term contracts. Small and mid-sized companies – and especially countries without their own projects – are pushed to the back of the queue. This is hard reality, which in Poland is often masked by slogans about “diversification” and “green transition”, without answering a simple question: who, and on what terms, will sell us real tonnes of NdFeB with Dy/Tb in 2028?

5. Poland versus the Heavyweights – a Table of Harsh Reality (Author’s Estimates)

Official Polish statistics are fragmentary, but based on EU import data, production structures and industry conversations, we can sketch an approximate picture. These are not figures from a single government report – they are the author’s estimates, based on public information and hands-on experience in the NdFeB magnet market. Even if we are off by 10–20%, the direction remains the same: a gap between what the heavyweights are doing and what we are doing.

This table is not meant to scare – it is meant to wake us up. If we believe Poland should remain a country with serious automotive, wind power and high-tech industries, then REE are not a “niche topic”. They are the foundation. Without them, everything else is window dressing.

6. Cost Simulation – How Dy/Tb Translate into PLN (Author’s Estimates)

The table below is a simplified simulation of the impact of a 2–3-fold price increase for Dy/Tb on selected sectors in Poland. It is not an official government forecast – it is an illustrative calculation showing the order of magnitude of the problem. The data are based on typical heavy-REE shares in magnets and approximate component cost structures.

In practice, you have to add leverage effects: higher cost of financing inventories, more expensive electricity for smelters and machining shops, intermediary margins and supply uncertainty. That is why the actual increase in end-product prices can be 2–3 times higher than the raw-material effect alone. If Dy and Tb are structurally more expensive, the entire chain pays more – from the motor manufacturer to the customer paying the monthly lease on an EV.

7. Old School, Old Hands – Why the REE and Magnet Trade Should Be Protected by the State

In Poland there is still a group of companies and people who have spent years importing, machining and distributing neodymium/ferrite magnets, separators and REE-based components. These are not grant-funded startups with a pitch deck for investors – this is the “old school”: people who remember the 2010–2011 crisis, know what real negotiations with Asian suppliers look like, and can tell a solid factory from a middleman repackaging someone else’s goods in a shiny narrative.

If the state treats raw-material security seriously, these are exactly the firms that should receive real protection: easier access to financing for strategic stockpiles, priority in support programs, sensible energy conditions and a clear status in the legal system. Without them, the whole conversation about “REE sovereignty” stays at the level of strategies and PowerPoints.

An N52 NdFeB magnet in an EV motor, the rotor of an offshore wind generator, or a small but critical magnet in a precision-guided munition – these are not exotic add-ons. They are elements of 21st-century critical infrastructure. If a country can protect grid operators, gas pipelines or its defense industry, it can – and should – equally protect those who supply its REE and magnets. Without them, all the big plans for energy and industrial transition end at press conferences.

8. Conclusion: China Has the Luxury of Time. Poland Doesn’t.

China has built an REE export-control system that can be tightened, loosened, suspended and re-activated at any time. It has separation capacity, its own magnet industry, a growing EV fleet – and all the time in the world. If the West moves slowly, Beijing will simply keep operating the tap – sometimes opening it, sometimes closing it. And every time, someone will pay.

The biggest players are already protected. Tesla, Toyota, MP, Lynas, Neo – each of them has a clear plan, contracts, stockpiles, its own plants and state support. Poland, for now, mostly has slide decks, slogans and talking points. This text is not a lament. It is a warning signal. If we want a real industrial base – from automotive to renewables and defense – we need to treat REE and magnets as what they actually are: strategic infrastructure. Not an exotic curiosity from the “science & tech” section.

Frequently Asked Questions about China's 2025 REE Export Controls