Yttrium Crunch Exposes China’s Regulatory Leverage

Supply-chain pressure around yttrium has intensified as China controls over 90% of refined yttrium oxide, concentrating separation capacity in Jiangxi and Inner Mongolia.
European spot prices have risen roughly 4,400% since January to about $270/kg, while Chinese domestic prices remain near $7/kg—a spread driven more by export licensing, shipping friction, and a thin merchant market than by instantaneous global production shortfalls.
Reports of empty warehouses describe merchant inventories, not the long-term contracts that major engine OEMs and semiconductor fabs typically hold for months of cover. New U.S. capacity such as ReElement’s planned 200 tpa yttrium oxide line is a meaningful hedge but remains small relative to global demand and needs substantial scale-up.
The deeper strategic shift is regulatory: export licenses, extraterritorial thresholds near 0.1%, technology-transfer restrictions, and even limits on expert movement give Beijing rule-making power over access to critical minerals.
The immediate takeaway is clear: markets are tight and China retains decisive levers, but the larger risk is a sustained governance-driven chokepoint rather than an overnight system collapse. Diversification is starting, but it will be gradual.