Australia's Lynas near 3-week high after China bans export of critical minerals to US

Renascor Resources

04/12/2024 06:09

Dec 4 (Reuters) - Shares of Australia's Lynas Rare
Earths  LYC.AX  climbed to a near three-week high on Wednesday,
a day after China banned exports of some critical mineral to the
United States.
    China on Tuesday banned exports of gallium, germanium and
antimony that have widespread military applications to the
United States, escalating trade tensions after Washington's
latest crackdown on China's chip sector.
    China's decision has raised concerns that it could target
other critical minerals, including those with even broader usage
such as nickel or cobalt, and rare-earths.
    Shares of Lynas, the world's biggest producer of rare earth
minerals outside China, ended the session up by 5% at A$7.32,
and was among the top gainers on the benchmark ASX 200  .AXJO ,
which slipped 0.4%.
    The ban signals the near-inevitability of a heightened
U.S.-China trade war 2.0, as Beijing continues its tit-for-tat
response to Washington's chip restrictions, said Hebe Chen, a
market analyst at IG.
    "This rising tension could potentially position Australia, a
key player in the global critical minerals market, to capitalize
on increased demand and diversify its export partnerships," Chen
said.
    The order also requires stricter review of end-usage of
graphite items exported to the U.S.
    Shares of graphite companies in Australia such as Syrah
Resources  SYR.AX  and Renascor Resources  RNU.AX  closed 13.6%
and 3.3%, respectively.

 (Reporting by Sherin Sunny in Bengaluru; Editing by Varun H K)
 ((Sherin.Sunny@thomsonreuters.com;))