China Adds MP Materials and USA Rare Earth to Its Export Control List (June 2026)
China escalated its trade fight with Washington on Monday, June 22, 2026, when its Ministry of Commerce added 10 US companies to its export control list, including the two rare-earth companies the US government has backed to cut reliance on China: MP Materials (NYSE: MP) and USA Rare Earth (Nasdaq: USAR). The ministry said the move was a response to the United States expanding its own list of Chinese military-linked entities earlier this month.
For investors, the action matters less for any single day's price move, which was muted, than for what it signals: the companies meant to reduce US dependence on Chinese rare earths are now themselves targets in the dispute, and the broader supply-chain pressure that runs through defense, electric vehicles, and semiconductors remains firmly in place.
What China did
China's Ministry of Commerce (MOFCOM) placed 10 US entities on its export control list, citing its Export Control Law and rules on dual-use items and national security. According to the ministry's notice, the listing bars Chinese exporters from supplying dual-use items to the named companies, prohibits parties anywhere from transferring or supplying China-origin dual-use goods to them, and requires ongoing transactions of that kind to be suspended, though exporters may apply to MOFCOM for approval in cases of genuine necessity. That is tighter than the prior regime, which generally required an export license. China's Finance Ministry separately restricted roughly 46 US firms from Chinese government procurement, according to reporting by the South China Morning Post and CNBC.
Which US companies were named
The 10 entities named by MOFCOM are Aveox, Inc.; Red Cat Holdings, Inc.; Teal Drones, Inc.; IMSAR, LLC; Jaia Robotics, Inc.; Ball Aerospace & Technologies Corp.; Oshkosh Defense; L3Harris Maritime Services, Inc.; MP Materials Corp.; and USA Rare Earth, Inc. Most are tied to defense, drones, or aerospace. Several are publicly traded or are units of public companies:
- MP Materials (NYSE: MP), which operates Mountain Pass in California, the only active rare-earth mine in the United States.
- USA Rare Earth (Nasdaq: USAR), which is building US mine-to-magnet processing capacity.
- Red Cat Holdings (Nasdaq: RCAT), a defense-drone maker; Teal Drones, also on the list, is a Red Cat subsidiary.
- Oshkosh Defense, a unit of Oshkosh Corporation (NYSE: OSK).
- L3Harris Maritime Services, part of L3Harris Technologies (NYSE: LHX).
The remaining names, Aveox, IMSAR, Jaia Robotics, and Ball Aerospace & Technologies, are privately held or part of larger non-US-listed groups.
Why the rare-earth firms stand out
Rare earths are a group of 17 metallic elements whose magnets are essential to motors, missiles, radar, and other high-performance hardware, and China dominates their mining and especially their processing. MP Materials and USA Rare Earth are central to the US effort to build a domestic alternative. MP entered a public-private partnership with the Department of Defense in 2025, and the Pentagon became a major shareholder with a stake of roughly 15%, according to CNBC. Placing those two companies on the control list points the dispute directly at the firms Washington has backed to reduce reliance on China.
How this fits the wider rare-earth control regime
Monday's listing is the latest step in a sequence that began in 2025, when China introduced extraterritorial controls on rare earths and magnets, and tightened further in early 2026. A partial suspension of the strictest rules is in place and runs until November 10, 2026, according to European Parliament research. The June 22 action is entity-specific, aimed at named companies, rather than a broad new restriction on rare-earth exports overall.
Market and sector implications
The immediate share-price reaction was limited. In early trading around the announcement, MP Materials was roughly flat and USA Rare Earth was modestly higher, according to Reuters; both have risen sharply this year, with USA Rare Earth up about 107% and MP up about 20% year to date, according to market-data providers. The muted move partly reflects that the listing restricts what the named firms can receive from China rather than directly cutting their sales.
The wider exposure runs through the sectors that depend on rare-earth magnets and materials: defense and aerospace (magnets in missiles, radar, and aircraft; yttrium in engine coatings), electric vehicles (neodymium magnets in motors), and semiconductors and electronics. Exposure here means a company sits in a supply chain that rare-earth availability can affect; it is not a statement that any specific company will see a material financial hit, which depends on supplier contracts, inventories, alternative sourcing, and licensing outcomes.
What to watch next
Key things to follow from here: any guidance from MOFCOM on licensing or exemptions for the listed firms; responses from the named companies and any US government reply; whether the partial suspension holds through its November 10 window; and supply-chain disclosures from defense, EV, and chip makers about rare-earth sourcing. For the broader picture of how the rare-earth supply chain works and where the pressure points sit, see our rare-earth supply-chain explainer.
This article is for informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any security. Company names, the export-control action, and market data are as reported by MOFCOM, the named regulators, and the news and market-data sources cited, as of the dates indicated. Always do your own research or consult a licensed financial professional before making investment decisions.
Last Updated: June 22, 2026.
The information provided in this article is for educational and informational purposes only. It does not constitute financial advice, investment recommendation, or an endorsement of any particular investment strategy. Past performance does not guarantee future results. Investors should conduct their own research and consult with a qualified financial advisor before making investment decisions.