Chinese rare-earth dealers are dodging Beijing’s export curbs

Chinese rare-earth magnet companies are finding workarounds to their government's onerous export restrictions, as they seek to keep sales flowing to Western buyers without falling afoul of Chinese authorities.

- Jon Emont

The companies are tweaking magnet formulas to avoid using certain restricted rare-earth elements and devising other strategies to get powerful magnets out of the country, like embedding them in motors, according to employees of several large Chinese magnet companies and Western firms that buy from them.

The strategies—which are legal—don’t work perfectly and the new magnets sometimes behave differently than traditional ones. But Chinese companies have huge and growing magnet-making capacity, and say they are determined to find legal ways to maintain exports.