China Rare Earth Stock Rally Returns Along With U.S. Tensions
Trump’s Sparring With China Revives Rare Earths Stock Trade
(Bloomberg) --
Chinese rare earth stocks surged in May amid bets increased tensions with the U.S. will spur the Beijing to limit exports of the crucial metals.
The sector saw double-digit jumps, led by China Minmetals Rare Earth Co. at 27% and JL Mag Rare-Earth Co. at 24%. Rare earth elements also rallied, with dysprosium oxide jumping almost 10% in barely a week to its highest since August while terbium oxide climbed 7.7%, according to commodities market information provider Shanghai SteelHome E-Commerce Co.
Such bets may be short-lived. A similar rally in May 2019, also triggered by rising tensions, unraveled when China didn’t enact export controls on rare earths and a phase one trade deal was signed. China produces about 70% of the world’s mined rare earths, which are used in products from electric vehicles to military hardware.
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With assistance from Bloomberg