U.S. companies continue to face substantial barriers obtaining certain critical minerals from China after Beijing imposed stringent export controls and licensing requirements, a U.S. business lobbying group said. The restrictions, introduced in April 2025, have left several rare earth elements effectively out of reach for many U.S. users and are prompting a broad shift by affected firms to diversify away from Chinese sources.
The U.S.-China Business Council (USCBC) based its findings on responses to its annual member survey carried out in February and March. The survey covered companies affected by the restrictions and found that the measures are driving significant sourcing changes: of 38 impacted companies, 29% reported they were actively switching to non-Chinese suppliers of critical minerals, while 47% said they were searching for alternatives but had not yet located viable options.
USCBC noted that despite some movement toward alternatives, confidence in longer term access to critical minerals remains low. The report singled out that some rare earth elements are now "nearly unobtainable." The controls were introduced in April 2025 in response to U.S. tariffs, according to the survey summary, even though a reported October agreement between U.S. and Chinese leaders had included a U.S. White House statement that China committed to "effectively eliminate" current and proposed critical mineral export controls.
Specific materials highlighted as particularly difficult to source include samarium cobalt magnets - used in high-temperature aerospace and defense applications - along with yttrium and cadmium. USCBC leaders emphasized not only the challenge of obtaining raw minerals but also the difficulty in securing finished rare earth magnets, which depend on both mining and advanced processing. The council said China’s control over the full chain - from extraction to processing and finished components - compounds the access problem for U.S. firms.
USCBC leadership said the export controls and licensing delays are forcing corporate supply chain diversification. One council official described the dynamic as China "forcing this diversification away from China and creating a strong interest on the part of the corporate sector to find alternatives." Another executive argued that resolving some of these supply constraints will require congressional involvement, noting that it cannot be solved by the Trump administration alone.
The report also documented a chill in investment intentions toward China. Among 134 companies surveyed, only 49% planned to invest in China this year, a level the council characterized as reflective of persistent uncertainty. USCBC commented that China’s business environment for foreign companies is not improving, citing domestic support measures for Chinese firms - including industrial policy and preferential treatment in government procurement - that the council said are eroding gains from formal market access openings.
USCBC warned that, despite U.S. efforts to rebuild mineral supply chains with partner countries and domestic initiatives, eliminating supply issues could be difficult within the next three years. That assessment underscores the near-term challenge for sectors that rely on these inputs, particularly high-tech manufacturing, aerospace, and defense industries that depend on specialized magnets and other rare earth-based components.
The council’s survey results portray a landscape in which export controls, licensing delays, and China’s processing dominance are reshaping corporate sourcing strategies and weighing on investment decisions tied to the Chinese market.