Suppliers to US aerospace and semiconductor companies face worsening rare earth shortages even after a trade detente between Washington and Beijing.
The crunch centres on niche rare earth elements such as yttrium and scandium critical materials used in defence systems, jet engines and next generation semiconductor manufacturing which are overwhelmingly produced in China.
Although Beijing resumed many rare earth exports after imposing restrictions in April, shipments of key materials to the United States remain severely limited.
Chinese customs data show that only 17 tons of yttrium products were exported to the US in the eight months after the controls were introduced, compared with 333 tons in the previous eight months.
The issue is expected to feature prominently when US President Donald Trump meets Chinese President Xi Jinping in Beijing in March, as Washington pushes for reliable access to critical minerals.
Yttrium, used in heat resistant coatings that prevent engines and turbines from melting at extreme temperatures, has become a major pain point. Prices have surged 60% since November and are now roughly 69 times higher than a year ago. Some manufacturers have begun rationing supplies.
Executives at two North American coatings firms said they have temporarily paused production due to shortages. One company has started turning away smaller and offshore customers to preserve supplies for major engine manufacturers.
Another firm in the supply chain recently ran out of yttrium oxide and halted sales of products containing the material.
While engine and chip production has not yet been directly disrupted, US officials acknowledge that some manufacturers are facing shortages of specific rare earth materials from China.
Scandium supplies are also tightening. The element plays a small but crucial role in aerospace alloys, fuel cells and advanced semiconductor processing, including components used in 5G smartphones and base stations.
Industry analysts warn that US semiconductor manufacturers are experiencing delays in securing new Chinese export licenses for scandium. With no domestic production and limited alternative global supply, companies may only have stockpiles lasting months rather than years.
A White House official said the administration remains committed to securing access to critical minerals through negotiations with China and by developing alternative supply chains.
Aerospace supply chain specialists describe the situation as a strategic pressure point.
“This is a watch item and a tangible example of how China is flexing its rare earth muscle,” said Kevin Michaels, managing director at consultancy AeroDynamic Advisory.
With global scandium production amounting to only a few dozen tons annually, and aerospace manufacturers already struggling to meet surging demand for aircraft and spare parts, industry leaders fear prolonged supply disruptions could eventually ripple through jet engine output and advanced chip manufacturing.
Goodness Anunobi
Follow us on:
