When China abruptly tightened exports of rare-earth elements earlier this year, the reverberations were immediate. Automakers announced curtailed production, electronics manufacturers scrambled for supplies, and policymakers denounced what they saw as coercive economic tactics. With more than 90 per cent of the world’s rare-earth refining capacity located in China, the initial panic was understandable.

Rare earths are embedded in almost every facet of modern technology ~ from the high-powered magnets in electric vehicles and wind turbines to the sophisticated systems inside missiles and fighter jets. Yet what looks like overwhelming leverage at first glance is also a trap. Every time Beijing brandishes its grip on rare earths, it sends shock waves that accelerate efforts to diversify supply chains. The last time China restricted shipments in 2010, Japan and several other countries poured resources into alternative mining, recycling, and........

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