The U.S. appears to have shelved its plan to levy tariffs on a critical collection of minerals used in everything from hybrid vehicles to electronic gadgets and military hardware, reports Bloomberg.
The minerals, known as “rare earths,” include scandium and yttrium and are absent from the latest list of about $200 billion of Chinese goods on which the Trump administration plans to impose duties. They were among a number of items scrubbed from the preliminary target list released in July along with car seats and Bluetooth devices.
The inclusion of rare earths in the first place was odd. China produced more than 80% of the world’s rare-earth metals and compounds in 2017, according to the U.S. Geological Survey. It has about 37% of global reserves and supplied 78% of U.S. imports.
China’s grip on rare earths supply is so strong that the U.S. joined with other nations earlier this decade in a World Trade Organization (WTO) case to force the nation to export more of the materials, not less, after prices spiked amid a global shortage. The WTO ruled in favor of the complainants, although prices eventually slumped as manufacturers turned to alternatives. (Source: Bloomberg)
Articles are chosen for summary in this Market Intelligence blog based on newsworthiness in conjunction with The Infinite Loop themes. Any opinions and views expressed in the articles are generally those of the underlying author from the source listed, are not necessarily current as of the date of this blog, may change as market or other conditions change, and may differ from views expressed by Ivy Investment Management Company and its associates or affiliates. Actual investments or investment decisions made by Ivy Investment Management Company and its affiliates will not necessarily reflect the views expressed in the articles. These articles are distributed for educational purposes only and are not investment advice or a recommendation to purchase, sell or hold any specific security mentioned in the article or to engage in any investment strategy. Investment decisions should always be made based on each investor’s specific financial needs, objectives, goals, time horizon and risk tolerance. Securities discussed may not be suitable for all investors.