Rare earth stocks took a hit Friday after China indicated it would approve new exports of rare earth minerals to the U.S. This, after the White House announced a deal had been reached between the two largest economies in the world.
The U.S. automotive industry cannot function without a steady supply of rare earth minerals. They’re used for everything from transmissions and alternators to motors, sensors, seat belts and cameras. This is why the threat of losing access to China’s rare earth bounty has been so concerning for U.S. automotive manufacturing.
So this new deal is great news for the automotive industry, as well as car buyers that would’ve definitely felt the pinch if this export ban on rare earths would’ve continued into summer. Rare earth stocks, on the other hand. Well, not so much.
This post originally appeared at Pro Trader Today.