A dump truck moves raw ore inside the pit at the Mountain Pass mine, operated by MP Materials, in Mountain Pass, California, U.S., on Friday, June 7, 2019.
Joe Buglewicz | Bloomberg | Getty Images
In the 1984 science fiction film Dune, Baron Vladimir Harkonnen uttered the famous quote that can aptly be used to describe rare earth metals: “He who controls the spice, controls the universe.”
The spice was central to the Dune universe, allowing trade to flourish and planets to prosper. In the same way, rare earth metals seem to be the spice today.
These metals are used in almost every electronic device, from smartphones and cars, to ballistic missiles.
In a sweeping move Thursday, China has tightened export rules on these critical materials, asserting dominance over the global tech supply chain.
The new measures mean companies need to apply for a licence from Beijing to export any products containing Chinese-sourced rare earth metals, while companies tied to foreign militaries or placed on export-control or watch lists will be denied permits.
China accounts for about 70% of the global supply and has repeatedly used critical minerals as a bargaining chip in trade discussions.
With a potential Trump-Xi meeting in South Korea soon, Beijing may be signalling its leverage ahead of high-stakes talks by tightening control over rare earth exports, and sending a message to the world that in the race for tech supremacy, it holds the high ground.
— CNBC’s Anniek Bao contributed to this report.
What you need to know today
China tightens rare earth exports… China has tightened export controls on rare earths and related technologies while barring its citizens from participating in unauthorized mining overseas. The latest restrictions came just weeks before a potential meeting between U.S. President Donald Trump and his Chinese counterpart Xi Jinping.
… sending rare earth stocks surging. U.S. rare earth and critical mineral miners surged Thursday after China tightened restrictions on exports, fueling market speculation that the Trump administration will move more aggressively to invest in building out a domestic supply chain.
Ferrari hits the brakes. Shares of Ferrari posted their worst trading day ever Thursday after the luxury carmaker’s full-year and 2030 guidance fell short of expectations, and it scaled back its electrification ambitions.
Samsung and SK Hynix hit records. South Korean chipmakers SK Hynix and Samsung Electronics climbed to record highs after a near-weeklong holiday, boosted by a series of artificial intelligence deals. In the U.S, the S&P 500 and Nasdaq took a breather from their all time highs Thursday stateside, dipping 0.28% and 0.08%, respectively.
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And finally…
Pedestrians in front of a pawn shop during Golden Week at night in Macau, China, on Sunday, April 30, 2023.
Bloomberg | Bloomberg | Getty Images
China’s Golden Week travel boom masks a bruising price war
The latest sign of hyper-competition, or “involution,” has emerged in China’s tourism industry, adding to concerns about growing deflationary pressure in the broader economy.
Over the Oct. 1 to 8 public holiday — dubbed “Golden Week” — total domestic tourism trips reached 888 million and generated 809.01 billion yuan ($113.63 billion) in revenue, according to official data released Thursday. That’s up by 1.8% and 7.6% from last year, respectively, according to CNBC’s calculations of the figures.
In fact, average spending per domestic tourist trip during the Golden Week was also around 3% lower than in 2019 before the pandemic, Goldman Sachs pointed out Thursday.
“The Golden Week was ‘Golden Weak,'” said Mix Shi, founder of PoshPacker Hostels Chengdu Group.
— Evelyn Cheng
