Signal China supplies all of the EU's imported heavy rare earth elements

Summary

A key driver of the EU's security concerns about China is the high geographic concentration of critical raw material and clean-tech supply chains. According to the Council of the EU, China supplies the entirety of the heavy rare earth elements the EU imports. The report stresses that this is not merely a question of price competition. Such concentration can translate into a risk of supply interruption for inputs needed by the energy transition, digital industries and defence. It is the backdrop against which the EU adopted the Critical Raw Materials Act in 2024, with a benchmark limiting reliance on any single third country at each processing stage, and the report expects dependence on China to be slow to unwind.