New Rare Earths Crisis Coming Caused By Shortage Of Yttrium
A new crisis is emerging in the rare earths sector as global supplies of yttrium tighten sharply, raising alarms over potential shortages and steep price spikes that could affect industries such as aerospace, energy, and semiconductor manufacturing.
Yttrium—an element extracted from rare earth minerals—has become increasingly scarce after China, the world’s dominant supplier, introduced export restrictions in April. These measures, applied to yttrium and six other rare earth elements, were imposed as a countermeasure to U.S. tariffs.
Although last month’s meeting between U.S. President Donald Trump and China’s President Xi Jinping temporarily boosted expectations of smoother trade in critical minerals, the underlying dispute remains unresolved.
While Beijing has relaxed certain rare earth curbs, the April restrictions continue to apply, leaving U.S. manufacturers uncertain about future access in the absence of a broader agreement between the two countries.
Industry participants and Argus analyst Ellie Saklatvla say the licensing requirements—forcing exporters to secure permits from Chinese authorities—have significantly slowed the flow of yttrium out of the country. So far, only small-volume licenses have been granted, and delivery times remain heavily delayed, Saklatvla added.
Scramble for Yttrium
According to Saklatvla, “China’s export controls have undoubtedly sparked a rush for yttrium.”
Prices reflect the strain: in Europe, yttrium oxide—used in thermal barrier coatings—has skyrocketed 4,400% since January, reaching $270 per kilogram, Argus data shows. In China, prices of around $7 per kilogram initially jumped 16% this year, though they have since begun to ease.
The U.S. Aerospace Industries Association (AIA) stressed that yttrium is a vital input for next-generation jet engines and said it is cooperating with the U.S. government to boost domestic sourcing. As Dak Hardwick, the group’s vice president for international affairs, put it: “Currently, our supply chain is heavily dependent on imports from China – a dependence that has fueled rising costs in the face of growing shortages.”
The semiconductor sector is also alarmed, two industry sources said, noting yttrium’s crucial role as both a protective coating and insulator. One source summarized the urgency bluntly as “9 out of 10.”
Beyond aircraft engines and chips, yttrium-based thermal coatings are widely used in gas-fired power plants to safeguard turbine blades from extreme heat.
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