Taiwan’s Ministry of Economic Affairs says the island’s chip sector will see “no significant impact” from China’s newly expanded rare-earth export controls, in comments first reported by Reuters on October 12. Those reassuring words come just days after Beijing added a fresh batch of heavy rare earths to its licensing regime — including holmium, erbium, thulium, europium, and ytterbium — and widened the scope to cover associated materials and processing tech.
Officials in Taipei were quick to note that these specific metals aren’t used by TSMC in wafer production, and that Taiwan already sources most of its rare-earth derivatives from allies in Europe, Japan, and the United States.
Taiwan’s economic ministry isn’t wrong to downplay the threat to semiconductor front-ends. But the PC space runs on more than silicon. Hard drives, for example, depend on voice-coil actuators and spindle motors built around high-performance magnets. Those magnets often rely on heavy rare-earth dopants to retain coercivity at elevated temperatures. The more China turns the screws on exports, the more likely it is that HDD and component vendors begin feeling the squeeze.
So, while there’s no immediate sign that fabs in Taiwan will suffer under this specific round of Chinese export controls, China doesn’t need to hit chipmakers directly to shake up supply chains. As licensing delays accumulate and enforcement expands, friction will continue to build downstream.
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