China has begun limiting the number of export licences it grants to European buyers of rare earth metals, according to several industry notices issued this week. Traders say the licences being approved now cover smaller shipment volumes and must be renewed more frequently, making it harder for smelters and magnet makers in Europe to secure supplies. A Commerce Ministry spokesperson confirmed on Friday that Beijing is evaluating all applications for restricted items "in line with China’s trade framework with the United States" and will continue to "strengthen" the approval process. The new screening adds to broader curbs introduced in April that require exporters to detail end-users, volumes and routes before any cargo can leave the country. The tighter controls have already rippled through supply chains. Chinese customs data show rare-earth magnet exports fell 75% in April and May, prompting several global automakers to suspend production of selected models because they could not source the specialised magnets used in electric motors and advanced sensors. At home, the policy is squeezing an industry that produces roughly 90% of the world’s rare-earth magnets. Two large producers told Reuters they expect revenue to decline this year, while smaller manufacturers have cut output by about 15% amid swelling inventories and soft domestic demand. Analysts warn the additional red tape will raise costs permanently and could accelerate consolidation in a sector that still counts hundreds of private operators.