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Chinese imports of rare earth from neighbouring Myanmar slowed in August as the closure of a key border crossing to contain the spread of the coronavirus prevented shipments.
China is the world’s dominant producer of rare earths, a group of 17 minerals used in consumer electronics and military equipment, but relies on Myanmar for about 50 per cent.
The disruption could have a knock-on effect on producers of rare-earth magnets used in electric vehicles and wind turbines and has already pushed up the prices of key magnets such as terbium and dysprosium.
Imports of rare earth compounds from Myanmar, which go to China for processing into material that can be used by manufacturers, were only 23 tonnes last month, down 91.8% from 270 tonnes in July, which was itself down 79% from June.
The border crossing with Myanmar at Tengchong, in southwest China’s Yunnan province, was closed in mid-July to prevent an increase in coronavirus cases.
The situation has not yet seen any improvement, suggesting that the border is unlikely to be reopened in the short term. This means China is unable to ship mineral processing chemicals to Myanmar or import rare earth compounds.
All Chinese state-owned enterprises that relied on Myanmar for the past five years now face supply chain risks with very few alternative suppliers.
Chinese imports of rare earth oxides from Myanmar were just 70 tonnes in August, down 93.5% from July, with imports from Malaysia unusually higher at 180 tonnes.
