In its tariff dispute with the United States, China is using rare earth metals as a strategic tool of pressure. This is hitting the German defense industry in particular. After all, it needs metals for weapons production.

Rare earth metals are key not only for the production of smartphones, electric cars and other civilian equipment, but also for the manufacture of weapons. In particular, they are needed for the production of combat aircraft and submarines. In addition, they are used in specially hardened ammunition and armored vehicles, in engines and sensors. For example, the F-35 fighter jet contains more than 400 kilograms of rare earth metals.

The lion’s share of rare earth metals used in production in Germany comes from China. And this is where the problem lies. After all, despite the fact that Chinese President Xi Jinping agreed with US President Donald Trump to postpone the introduction of additional restrictions on the export of rare earth metals, state control over them is already strict. Among China’s recent threats was, in particular, a complete ban on the export of metals for military purposes. The procedure for obtaining a permit to purchase metals from China for weapons production is already complicated.

In particular, companies that apply for exports from China must submit detailed data, some of which is secret. This is a particularly sensitive point for weapons manufacturers. “Specifying the final recipient, high bureaucratic obstacles and access to logistics data is, in essence, a good form of industrial espionage,” Jakob Kullik, a political scientist at Chemnitz University of Technology, told DW.

The Federal Association of German Industry (BDI) is even more critical of Beijing: “The new controls (on rare earth metals exports. – Ed.) can be interpreted as a direct attack on the West’s new weapons.” Recently, the German defense industry has significantly increased its capacity so that the Bundeswehr can be armed with modern systems in view of the threat from Russia. Another goal of the increase in production capacity is military aid to Ukraine, which is likely to irritate Russia’s partner China.

German weapons manufacturers reassure
How is the German defense industry itself reacting to the situation? “We are not panicking,” Hans-Christoph Atzpodin, head of the German Security and Defense Industry Association, told DW. According to him, the defense industry uses “rather small volumes” of rare earth metals. In addition, companies in the sector “have taken measures” to maintain production at the required level in the coming months.

Nevertheless, experts consider the risks of shortages of certain raw materials to be real. China controls 80 percent of the world’s production and more than 90 percent of the processing of rare earth metals. “If the situation worsens, the big question will be: where will defense companies get alternatives? And there are no options here,” says political scientist Kullik, who studies the strategic importance of raw materials for military security.

No alternative to China yet
The search for an alternative to China will take many years, even if it were to start right now, admits Hans-Christoph Atzpodin. “We believe that we need to act urgently so that we in Europe as a whole become more independent,” he emphasizes on behalf of the German defense industry. He believes that Europe itself should build up the capacity to process rare earth metals. “This requires relaxation of the relevant environmental permits,” he says.

Mining rare earth metals is a complex, dirty and expensive business. The 17 chemical elements referred to when we talk about rare earth metals are not all that rare in the Earth’s crust. However, their concentration is usually extremely low. To obtain them, you have to dig up a large amount of rock and ore from the ground, and special chemicals are often needed to separate the elements from this mass.