Neodymium. Yttrium. Dysprosium. You can be forgiven for not knowing the names of these rare earth metals. They were little known until a recent price surge brought them to wider attention. But the 17 so-called rare earths, not produced much outside China, are used to produce myriad modern goods from hybrid cars to mobile phones, wind turbines and smart bombs. That gives China a potential stranglehold on supply, a position it is understandably happy to exploit. Other countries should not let it.

Deng Xiaoping declared: “The Middle East has oil, and China has rare earths,” a slogan emblazoned on the wall of the Baotou Steel Rare Earth Hi-Tech Company, the world’s biggest producer. In truth, market forces, as much as state planning, created China’s near-monopoly. Rare earths are not all that rare but so much cheaper are they to produce in China – where labour costs and environmental standards are lower – that most mines elsewhere have gone out of business. So with just 36 per cent of global deposits, China accounts for 97 per cent of production. When, in July, it cut export quotas by three-quarters, the price of some rare earths shot up six-fold.

Beijing may be trying to encourage companies needing rare earths to shift production to China. Tokyo claims Beijing deliberately withheld exports to Japan during a diplomatic tussle over disputed fishing grounds. A more innocent explanation is that the restrictions are part of a laudable effort to consolidate China’s rare-earths’ industry around bigger producers with higher environmental standards.