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The Group of Seven (G7) nations and the European Union are said to be discussing the idea of imposing price floors on rare earths to counter China’s dominance in the supply chain, Reuters reported on Wednesday.
A price floor, if imposed, would provide greater incentives for producers of rare earths and related products in those regions, which for decades have relied on Chinese supply. Rare earths, which are difficult to extract and expensive to process, are key to many high-tech products, including cell phones, EVs and defense applications.
China currently dominates the global mine supply of rare earths and controls over 90% of their total processing capacity. This forces the G7 nations, with the exception of Japan, to their supply rare earths and related products such as permanent magnets, which are used in wind turbines and electric vehicles, exclusively from China.
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