• China's rare earth magnet exports fell 6.1% in September from August.
• Shipments to the U.S. dropped 29% year-on-year, signaling intensifying trade tensions.
• The government expanded export controls as tensions rose ahead of talks between Xi and Trump.

China's rare earth magnet exports have shown a significant decline, falling by 6.1% in September from the previous month, marking the end of a three-month streak of increases. This decline is largely attributable to the government's tightening of export license applications and the introduction of new export controls, particularly amid ongoing trade discussions with the U.S. and Europe. The total shipments amounted to 5,774 metric tons in September, compared to a high of 6,146 tons in August, according to Reuters.

Particularly worrisome for the trade relationship, China's exports of rare earth magnets to the United States have experienced a much more severe decline, plummeting by 28.7% from the previous month — a year-on-year decline of 29.5% was recorded in September. This drop follows a brief recovery period initiated in June when temporary easing measures were implemented to facilitate U.S. shipments. The current statistics affirm that the U.S. became the fourth-largest destination for these exports, down from second place in August, according to South China Morning Post.

The steep decline in rare earth magnet exports is seen as both a reflection of increasing governmental controls and as a strategic element in the ongoing trade war. The recent changes, including stricter export controls which will extend to technology related to rare earth elements beginning December, exemplify how China is leveraging its dominant position in the rare earth market as negotiations with the U.S. unfold. As noted, "they remain a major battleground," indicating the products' significance in high-tech industries like electric vehicles and defense, according to Bloomberg and South China Morning Post.