ZGXT(SZ:000831) Sou Hu Cai Jing·2026-01-15 05:11Core Viewpoint - The G7's decision to reduce reliance on Chinese rare earth imports is a strategic move that reflects both economic and political motivations, coinciding with China's tightening of export controls on rare earths [3][4][14]. Group 1: G7's Strategy and Political Implications - The G7's announcement to decrease dependence on Chinese rare earths is not a spontaneous decision but part of a long-term strategic plan [3]. - The timing of this decision aligns with China's increased control over rare earth exports, indicating a response to perceived threats to their own industries [3][4]. - The G7 aims to project a united front against China's dominance in the global supply chain, although their statements lack concrete implementation details [4][10]. Group 2: China's Dominance in Rare Earths - China holds approximately 36% of global rare earth reserves but dominates production, contributing over 80% of the world's annual output of around 210,000 tons [6][9]. - The country possesses advanced processing and purification technologies, achieving purity levels above 99.99%, which other nations struggle to replicate [7][10]. - China's complete industrial chain from mining to processing gives it significant control over supply and pricing in the global market [9][10]. Group 3: Challenges for G7 in Reducing Dependence - The G7 faces three main challenges in reducing reliance on Chinese rare earths: finding alternative sources, achieving technological breakthroughs, and controlling costs [10][12]. - Alternative sources for rare earths are limited, with countries like Australia facing high extraction costs and environmental regulations, while the U.S. has struggled with production limitations [10][12]. - Even if alternative production capabilities are developed, they would require substantial investment and time, estimated at 5 to 10 years, to become competitive with China's established supply chain [10][12]. Group 4: Growing Global Demand for Rare Earths - Global demand for rare earths is expected to grow at over 10% annually, driven by industries such as electric vehicles, wind power, and semiconductors, complicating the G7's goal of reducing imports from China while meeting domestic needs [12][14].