Understanding the Continued Delays in China’s Heavy Rare Earth Export Licenses: A 2025–2026 Market Update

December 3, 2025

The global market for samarium cobalt (SmCo) magnets is under exceptional pressure. A convergence of export controls, raw material restrictions, and cost volatility is reshaping how these high-performance magnets are sourced and priced. This update summarizes the current conditions influencing availability, outlines the outlook for the next year, and explains how Dura Magnetics is managing these developments to support its customers.

Executive Summary

China’s export restrictions on heavy rare earth elements (HREEs) and related downstream products—such as Samarium Cobalt (SmCo) magnets and high-temperature NdFeB magnets—continue to create significant supply-chain uncertainty. Despite political signals in late 2025 pointing toward future regulatory flexibility, no operational changes have yet materialized. Export license processing remains slow, unpredictable, and tightly scrutinized.

This update provides a market-level summary of what has happened, what is changing, and what remains unresolved as we enter 2026.

1. Background: MOFCOM’s Enhanced Controls

In April 2025, China expanded its export control regime under MOFCOM Announcement No. 18, adding seven medium and heavy rare earth elements—along with products derived from or containing them—to the restricted export list.

This change brought:

• SmCo magnets
• NdFeB magnets containing Dy/Tb
• Certain rare-earth alloys and compounds

under a controlled export framework requiring a non-automatic license for every shipment.

While the stated intent of the regulation was national-security alignment and conservation of strategic materials, the practical outcome has been prolonged review cycles, increased documentation demands, and supply-chain delays across multiple industries.

2. Early Expectations vs. Observed Reality

When the new controls were deployed, Chinese provincial commerce bureaus informally advised exporters that the review period would be 45–60 days.

However:

• There is no statutory review period
• Many applications have exceeded 60–120+ days without decision
• “No rejection” does not mean progress, applications often remain in prolonged administrative limbo

By mid-2025, delays had become the norm, not the exception.

3. Additional MOFCOM Announcements (October 2025)

In October 2025, MOFCOM issued six additional updates, expanding export controls to include:

• More rare earth elements and compounds
• Select processing equipment
• Extraterritorial licensing requirements for foreign-produced items containing Chinese-origin rare earths

These changes broadened the scope and sensitivity of compliance, affecting global downstream industries.

4. U.S.–China Leadership Meeting (November 2025): Policy vs. Implementation

At the November 2025 bilateral meeting, the U.S. and China announced intentions to:

• Relax certain enhanced restrictions
• Introduce a General License framework for low-risk commercial exports

However:

• No MOFCOM implementation rule has been published
• No Customs notice has been issued
• No provincial-level procedures exist
• No exporter currently possesses a functioning General License
• The announcement was political, not operational.

5. Current State: Case-by-Case Approvals Only

As of December 2025, limited approvals have been observed, but only for:

• Large multinational companies
• Low-risk, non-sensitive commercial supply chains
• Applications accompanied by robust end-use documentation

Heavy-REE magnets destined for aerospace, medical technology, controls, sensors, or potential dual-use environments remain highly scrutinized.

Applications with unclear or incomplete industry-chain documentation often remain in indefinite review.

Key observations:

• Military-adjacent applications are almost never approved
• Commercial approvals remain sporadic, not systematic
• Documentation expectations have risen sharply, including disclosure of the complete manufacturing value chain and final application

6. Timeline: China’s Evolving Heavy Rare Earth Export Controls (2025–2026)

April 2025 — MOFCOM Announcement No. 18

• Seven medium and heavy rare earth elements—and associated products including SmCo and Dy/Tb-bearing NdFeB—added to the restricted export list.

Spring–Summer 2025 — Informal 45–60 Day Review Expectation

• Provincial bureaus communicate estimated review durations, though no statutory timeline exists.
• Actual processing times soon exceed expectations.

October 2025 — Additional MOFCOM Announcements

• Controls expand to more elements, processing equipment, and foreign-made items containing Chinese-origin rare earths.

November 2025 — U.S.–China Leadership Meeting

• Political announcement of intent to relax certain controls and explore a General License mechanism.
• No implementation details delivered.

December 2025 — Select Case-by-Case Approvals

• A small number of large multinational companies receive licenses for certain commercial shipments.
• Approvals remain rare, documentation-intensive, and unpredictable.

Early 2026 — Outlook

• General License mechanisms not yet implemented.
• Licensing remains restrictive, with delays disproportionately affecting heavy-REE magnetic materials.

7. What the Market Should Expect Going Forward

a. Continued variability in review times

Without statutory review periods, China may continue case-by-case evaluation for the foreseeable future.

b. General licenses remain conceptual

Until MOFCOM publishes procedures, no exporter can leverage a broad preapproval model.

c. Heightened documentation expectations

Industry-chain narratives, detailed end-use descriptions, and authenticated customer information are increasingly required.

d. Military, aerospace, and sensor applications will face persistent scrutiny

This category is highly unlikely to see near-term regulatory easing.

8. What Dura Is Doing to Help

• Dura has implemented several measures to support customers navigating these constraints:
• Enhanced documentation workflows aligned with evolving Chinese expectations
• Early engagement with customers to gather required end-use materials
• Vendor-level coordination to monitor application movement and prevent administrative delays
• Regular review of MOFCOM updates and provincial guidance
• Transparent communication to ensure customers understand the regulatory landscape

9. Planning Considerations for Mitigating Supply Risk

While Dura will continue to support customers through documentation, communication, and regulatory monitoring, it is important to acknowledge that no amount of supplier diligence can influence or accelerate China’s export-license decisions for heavy rare earth materials. The licensing process remains deeply opaque, politically influenced, and highly variable across provinces and product categories.

Because these constraints lie entirely within the jurisdiction of the Chinese government, and because current approval timelines show no sign of returning to predictability, it may be prudent for customers to evaluate design strategies that reduce exposure to controlled heavy-REE materials.

Some organizations have begun exploring the following approaches to improve long-term supply stability:

• Assessing whether the current design could accept a more commonly available  Commercial of the Shelf “COTS” SmCo geometry, such as standardized discs or blocks that already reside with the US.
• Evaluating whether an NdFeB alternative, with appropriate temperature and demagnetization safeguards, could satisfy performance requirements in non-critical applications.

These strategies will not be appropriate for every application; many high-performance systems legitimately require heavy-REE magnet technologies, and Dura will continue to support those programs with full transparency as export conditions evolve. However, given the continued uncertainty surrounding MOFCOM’s review process, customers may benefit from including these considerations in their long-term program planning.

Dura’s engineering and applications teams are available to collaborate with your designers to evaluate whether any feasible alternatives exist, either for the current program or for future revisions of the product. Together, we can help identify options that reduce supply-chain risk while maintaining the required magnetic, mechanical, and environmental performance characteristics.

Dura will continue to maintain high readiness to update procedures as soon as China releases operational guidance for any future general-license regime.

Conclusion

Despite political dialogue indicating potential loosening, China’s heavy rare earth export controls remain stringent and unpredictable. Approval timelines continue to vary widely, often exceeding three months, and documentation burdens are substantial.

Until regulatory procedures are officially released, all market participants should expect continued delays and case-by-case approvals, particularly for materials containing samarium, terbium, dysprosium, or other heavy rare earth elements.

Dura will continue providing updates as new information becomes available.