Bessent Defends Tariffs Amid Rare‑Earth Strain

Treasury Secretary Scott Bessent has framed China’s recent export restrictions on dysprosium, terbium and other rare earths as grounds for emergency tariffs under the International Emergency Economic Powers Act, while the U.S. Supreme Court prepares to weigh the administration’s legal authority.

After a Trump–Xi meeting in South Korea, Washington paused plans for a proposed 100 percent tariff as Beijing agreed to ease select export curbs, but the United States still imports roughly 90 percent of separated rare earths from China, underscoring persistent supply fragility.

China’s 2025 MOFCOM notices expanded licensing controls to a dozen REEs, including core inputs for electric-vehicle motors, wind turbines and defense magnets; recent interruptions disrupted automakers and other industrial buyers.

Industry observers say tariffs can signal leverage, but they do not remedy the underlying bottleneck: underbuilt U.S. midstream capacity for refining, separation and magnet production. Companies such as Ucore, Energy Fuels, Aclara Resources and MP Materials are advancing projects, yet policy volatility and shifting trade rhetoric continue to deter long‑term investment and permitting stability.

With rare earths now a geopolitical proxy, the Supreme Court’s decision and subsequent policy choices will shape whether the U.S. moves from reactive tariff theater to sustained industrial reconstruction.