On April 4, 2025, China imposed export controls on seven heavy rare earth elements — samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium — along with their compounds, metals, alloys, and any magnets containing them. On October 9, 2025, Beijing expanded the controls to include holmium, erbium, thulium, ytterbium, and — critically — “parts, components, and assemblies” containing any of these materials, including products manufactured outside China using Chinese-sourced inputs at concentrations as low as 0.1%. The controls were suspended on November 7, 2025, as part of the Xi-Trump trade agreement, for one year until November 2026. They are, as of this writing, frozen — not withdrawn. Before the suspension, European dysprosium oxide prices reached $900 per kilogram, roughly triple the Chinese domestic price of $255. Terbium oxide was trading at levels that caused suppliers to halt sales to private investors entirely, prioritizing industrial customers. The CEO of Germany’s Vacuumschmelze — one of the few rare earth magnet manufacturers outside China — told Reuters in November 2025: “If you talk about critical resources, it’s really the heavies, the heavies, the heavies — all the rest we will get.” He was talking about terbium and dysprosium. And he was right.
What terbium does
Terbium is a heavy rare earth element — atomic number 65 — and its industrial importance is almost entirely about magnets. Neodymium-iron-boron permanent magnets are the most powerful permanent magnets in existence, used in every EV traction motor, every direct-drive wind turbine generator, every hard disk drive, every guided missile, every MRI machine, and most industrial robots. The problem with NdFeB magnets is that they lose their magnetic properties at elevated temperatures — above roughly 80°C, an NdFeB magnet begins to demagnetize. An EV motor operating under sustained load, a wind turbine nacelle in summer heat, a fighter jet engine bay — all exceed that threshold. Adding small quantities of terbium or dysprosium to the alloy extends the operating temperature range to 200°C or higher. The addition is small — a few percent by weight — but the effect is the difference between a magnet that works in a laboratory and a magnet that works in a car.
Terbium is the more effective of the two heavy rare earth additives — it provides stronger coercivity enhancement per unit of concentration than dysprosium — but it’s also rarer and more expensive. In practice, magnet manufacturers use both, often in combination, depending on the application’s thermal requirements and the relative cost and availability of each. For the highest-performance applications — military systems, aerospace actuators, precision guidance systems — terbium is preferred. For lower-temperature applications, dysprosium suffices.
Beyond magnets, terbium has a secondary role in phosphors — it emits a vivid green light when excited, which made it essential for color television, fluorescent lighting, and trichromatic display systems. LED technology has largely displaced fluorescent phosphors, but terbium-based phosphors remain relevant in medical imaging, scientific instruments, and specialized displays. Terbium is also the primary component of Terfenol-D — an alloy of terbium, dysprosium, and iron that exhibits the strongest magnetostriction of any known material, meaning it physically expands and contracts in response to magnetic fields. Terfenol-D is used in naval sonar transducers, precision actuators, and vibration sensors. A submarine’s ability to detect other vessels depends, in part, on terbium.
Where 98% comes from
China controls over 90% of refined terbium supply. The highest-grade commercial deposits are ion-adsorption clays in southern China — Jiangxi, Guangdong, Fujian — where heavy rare earths are adsorbed onto clay particles and extracted by leaching with ammonium sulfate. A ton of clay yields a few hundred grams of mixed rare earth oxides, of which terbium might constitute a few grams. The extraction is low-tech, environmentally destructive (the leaching process contaminates groundwater and strips hillsides), and labor-intensive — but the deposits are uniquely rich in the heavy rare earths the magnet industry needs.
Myanmar has become the second most important source of heavy rare earth ore — mined primarily in the Kachin and Wa states by ethnic militias operating in a civil war zone, shipped across the Chinese border, and processed in Chinese separation facilities. The ore flows through a corridor that China effectively controls on both ends: the armed groups who mine it depend on Chinese buyers, and the separation capacity that converts raw ore into usable oxide is 98-99% concentrated in China. Conflict minerals is a term usually applied to the DRC’s cobalt and coltan supply chains. The Myanmar heavy rare earth trade has the same structural characteristics — extraction in a conflict zone, processing controlled by an external power, and end-use in consumer products whose buyers rarely ask where the material came from.
The West has deposits but not capacity. MP Materials’ Mountain Pass mine in California produces light rare earths — neodymium and praseodymium — but contains only traces of terbium and dysprosium. Lynas Rare Earths in Australia began heavy rare earth separation in Malaysia in 2025, becoming the first non-Chinese heavy rare earth separator on Earth — but at initial volumes of roughly 250 tonnes of dysprosium and 50 tonnes of terbium per year, it’s a fraction of global demand. Energy Fuels, a Denver-based uranium miner, is pivoting to rare earth separation using similar process chemistry — but is not yet producing at scale. Brazil is emerging as an ore exporter, but as Benchmark Mineral Intelligence noted, “the technology for HREE refining is expected to be available globally by 2029” and “costs outside of China remain 5-7 times higher.” The problem is not that heavy rare earth deposits don’t exist outside China. The problem is that the separation and refining capacity to convert those deposits into usable materials is, as of 2026, a Chinese monopoly with a few early-stage Western competitors years away from meaningful scale.
The April 2025 export controls
The April 2025 controls followed the same escalation pattern the Rare Earth Elements course has documented across gallium/germanium (July 2023), graphite (October 2023), antimony (August 2024), and tungsten (early 2025) — but with a crucial escalation. The earlier controls restricted raw materials and processed forms. The April 2025 controls restricted magnets containing terbium and dysprosium — finished products, not just feedstock. The October 2025 expansion went further: it applied extraterritorial jurisdiction to “parts, components, and assemblies” containing Chinese-sourced rare earth materials, even if manufactured outside China, even if traded domestically in a third country. A European carmaker using a motor containing a magnet with 0.1% Chinese-origin terbium would, under the October rules, need a Chinese export license for the motor — not for the terbium, for the motor.
The IEA reported that after the April controls took effect, “many carmakers in the United States, Europe, and elsewhere struggled to obtain permanent magnets, with some forced to cut utilisation rates or even temporarily shut down factories.” European rare earth prices reached up to six times Chinese domestic prices. The November 2025 suspension froze the escalation but did not reverse it. The controls remain on the books. The licenses remain at Beijing’s discretion. The semiconductor supply chain has TSMC in Taiwan. The lithium supply chain has Chinese refining. The magnet rare earth supply chain has something worse: Chinese separation capacity so dominant that the export controls don’t just restrict supply — they assert jurisdiction over finished products manufactured anywhere in the world using Chinese-origin inputs. That’s not a trade restriction. That’s extraterritorial industrial policy.
Why terbium is the real bottleneck
McKinsey projects global demand for magnet rare earths will triple from 59,000 tonnes in 2022 to roughly 176,000 tonnes by 2035. Under rapid clean-energy adoption scenarios, terbium requirements could reach 134-256% of available supply — meaning the energy transition needs one-and-a-half to two-and-a-half times more terbium than the planet currently produces. The EU projects that demand for rare earth magnets could increase tenfold by 2050. The projected 60,000-tonne shortfall by 2035 — approximately 30% of total requirements — is concentrated in the heavy rare earths, not the lights. Neodymium and praseodymium can be sourced from Mountain Pass, from Lynas, from emerging projects in Brazil and Africa. Terbium and dysprosium cannot — not at the volumes the market needs, not at processing costs the market can absorb, and not from facilities that currently exist outside Chinese control.
Every EV motor, every wind turbine, every humanoid robot actuator, every military guidance system that requires a high-temperature permanent magnet runs into the same constraint: the heavy rare earths that make the magnet work at temperature come from one country, are separated in one country, and are now subject to export controls that assert jurisdiction over products made in every other country. The nickel supply chain was restructured by Indonesian resource nationalism in five years. The terbium supply chain was never diversified enough to restructure — it started concentrated and stayed concentrated, and the concentration is now being weaponized.
This is the kind of supply chain our Rare Earth Elements course was built to map — where the element that allows an EV motor magnet to survive operating temperature is separated from clay in southern China and a civil war zone in Myanmar, refined in facilities that are 98% Chinese-controlled, subject to export controls with extraterritorial reach, and projected to be in deficit by 2035 under every growth scenario the energy transition requires.