In its latest attempt to break China’s grip on rare earth supplies, Australia banned a Chinese-linked investment fund from boosting its stake in a crucial rare earth producer.
Last year, the company Yuxiao Fund attempted to double its investment in Northern Minerals Limited—from just under 10 percent to nearly 20 percent. Australia’s federal treasurer blocked the move but gave no comment.
According to the executive chairman of Northern Minerals, Yuxiao Fund is linked to a Chinese national named Yuxiao Wu, who also owns rare earth mines in Mozambique, a nation in southern Africa.
Rare earth minerals are key to crafting military equipment. China currently dominates rare earth production globally, accounting for 85 percent of the world’s refining capacity.
Earlier this year, the United States also took action against Beijing’s monopoly in the sector. America’s only rare earth producer sent output from its new processing plant to Japan, marking an effort to reduce Chinese control over the supply chain.