China's rare earth magnet exports plummeted to their lowest level in over five years during May 2025, as new export restrictions and stringent customs scrutiny severely disrupted global supply chains. The world's dominant supplier of rare earth magnets shipped only 1,238 metric tons last month, representing a dramatic 75% decline compared to May 2024 and impacting industries worldwide.
According to China's General Administration of Customs, May's rare earth magnet exports dropped 52.9% from April's already diminished figures. The 1,238 metric tons shipped marked the weakest monthly performance since February 2020. April exports had previously halved from March levels, establishing a concerning downward trajectory.
For the January-May period, total exports reached just 19,132 metric tons, down 14.5% year-on-year and representing the lowest five-month total since 2021. These statistics underscore the severity of disruption facing global manufacturers who depend heavily on Chinese rare earth magnet supplies for their production processes.
The export decline has sent shockwaves through multiple sectors, including automotive, aerospace, semiconductors, and military equipment manufacturing. China produces over 90% of the world's rare earth magnets, making alternative sourcing extremely challenging for global manufacturers. Companies across these industries are scrambling to secure alternative suppliers or adjust production schedules to accommodate reduced magnet availability.
The automotive sector, particularly electric vehicle manufacturers, faces significant challenges as rare earth magnets are essential components in electric motors. Aerospace companies similarly depend on these materials for various applications, while semiconductor manufacturers require them for specific production processes.
Chinese customs officials struggle to interpret and apply Beijing's export control rules, creating additional delays beyond formal restrictions. Sources report increased caution among customs personnel, particularly regarding shipments for appliances and consumer electronics. While China's commerce ministry announced approval of some export licenses and Beijing agreed to expedite processes, regulatory ambiguity and customs bottlenecks continue hindering shipments despite diplomatic efforts.
China's rare earth magnet export restrictions represent a significant shift in global supply chain dynamics, forcing industries to confront their dependency on a single supplier. While some export licenses have been approved and diplomatic discussions continue, the sustained decline in shipments suggests long-term challenges ahead. Companies must develop alternative sourcing strategies to mitigate future supply disruptions.