The United States has recently suspended licences allowing nuclear equipment suppliers to sell to China’s power plants, amid an intensifying trade war, sources said.
The suspensions were sent to companies by the U.S. Department of Commerce, the people said, and affect export licences for parts and equipment used with nuclear power plants.
Nuclear equipment suppliers are among a wide range of companies whose sales have been restricted over the past two weeks as the U.S.-China trade war shifted from negotiating tariffs to throttling each other’s supply chains. It is unclear whether a Thursday call between U.S. President Donald Trump and Chinese President Xi Jinping would affect the suspensions.
Tit-For-Tat Tariffs
The U.S. and China agreed on May 12 to roll back triple digit, tit-for-tat tariffs for 90 days, but the truce between the two biggest economies quickly went south, with the U.S. claiming China reneged on terms related to rare earth elements, and China accusing the U.S. of “abusing export control measures” by warning that using Huawei Ascend AI chips anywhere in the world violated U.S. export controls.
On Friday, Trump said U.S. and Chinese officials would meet again on June 9.
The U.S. Department of Commerce did not respond to a request for comment on the nuclear equipment restrictions. On May 28, a spokesperson said the department was reviewing exports of strategic significance to China.
“In some cases, Commerce has suspended existing export licences or imposed additional license requirements while the review is pending,” the spokesperson said in a statement.
U.S. nuclear equipment suppliers include Westinghouse and Emerson.
Westinghouse, whose technology is used in over 400 nuclear reactors around the world, and Emerson, which provides measurement and other tools for the nuclear industry, did not respond to requests for comment.
The suspensions affect business worth hundreds of millions of dollars, two of the sources said.
A spokesperson for the Chinese Embassy in Washington said Xi emphasised on his call with Trump that both sides should make good on the agreement reached in Geneva on May 12. China has been “earnestly” executing the agreement, the spokesperson, Liu Pengyu, said in a statement on Friday.
“The U.S. side should acknowledge the progress already made, and remove the negative measures taken against China,” the statement said. China’s rare earth export controls are in line with common practice and not targeted at specific countries, it added.
They also coincide with Chinese restrictions on critical metals threatening supply chains for manufacturers worldwide, especially America’s Big Three automakers.
Temporary Rare-Earth Licences
China has granted temporary export licences to rare-earth suppliers for the U.S. automakers, Reuters reported on Friday.
Reuters could not determine whether the new restrictions were tied to the trade war or if and how quickly they might be reinstated. Department of Commerce export licenses typically run for four years and include authorised quantities and values.
But many new restrictions on exports to China have been imposed in the last two weeks, according to sources, and include licence requirements for a hydraulic fluids supplier for sales to China.
Other licence suspensions went to GE Aerospace for jet engines for China’s COMAC aircraft, sources said.
The U.S. also now requires licences to ship ethane to China, as Reuters reported first last week. Houston-based Enterprise Product Partners said Wednesday that its emergency requests to complete three proposed cargoes of ethane to China, totalling some 2.2 million barrels, had not been granted.
Enterprise said a May 23 requirement for a licence to sell butane to China, in addition to the ethane, was subsequently withdrawn. Dallas-based Energy Transfer said it was notified on Tuesday about the new ethane licensing requirement and planned to apply and file for an emergency authorisation.
Other sectors that have been hit with new restrictions include companies that sell electronic design automation software, such as Cadence Design Systems.
(With inputs from Reuters)
