China has issued rare earth export licenses to select companies, but the number of licenses granted is unclear, and it’s uncertain if any went to U.S. firms. The Chinese commerce ministry announced that they approved “a certain number” of applications in their latest round. They plan to improve their approval process for compliant applications and are willing to communicate with other countries about export controls. This announcement indicates that China is carefully resuming the issuance of rare earth export licenses after a period of strict review and limited approvals. While the specifics of the approvals remain vague, this suggests a cautious return to licensing rather than a major policy change. The uncertainty about whether American companies received licenses raises questions about trade relations and points to a careful approach instead of a complete lifting of limits. The commerce ministry’s openness to dialogue should not be viewed as an indication of quick regulatory changes. Instead, it reflects an ongoing strategy to maintain control over rare earth production and its global distribution. By aiming to “enhance” the license approval process, regulators are emphasizing compliance with domestic standards and selectively screening exports based on political and supply chain factors. Practically, this suggests that materials from Chinese producers will be available, but only under strict conditions and to those approved by the state. This is not a broad reopening, and expectations for uniform trade normalization should be set aside until there is more consistency in future licensing batches. In the coming weeks, we anticipate tighter spreads and fewer opportunities in rare earth contracts, as uncertainty around Chinese supply has caused greater market volatility. Any unclear updates from Beijing or a lack of U.S. deals could affect pricing. Given the unpredictable nature of these updates, it’s wise to avoid heavily relying on expected easing, particularly for long-term positions. Instead, a balanced strategy that is short-to-medium term is preferable, with flexibility where possible, especially for investments sensitive to raw material supply from Asia-Pacific. It may also be prudent to diversify toward producers outside mainland China, especially in cases where supply alternatives are strong. Keeping track of detailed customs data might provide better insights than official announcements, which are likely to remain vague and infrequent. Jiang’s department’s tendency to continuously adjust regulations means pricing around policy changes could fluctuate. There is often little advance notice or structured communication, so don’t expect typical transparency. As always, flexible trade structures, which can be adjusted if conditions shift, tend to be more resilient than strict directional positions.

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