Rare Earth stocks rallied in premarket trading. NioCorp Developments up 6.8%; USA Rare Earth up 5.5%; The Metals up 3.3%; MP Materials up 2%.

Some European auto parts plants have suspended output and German carmaker BMW warned its supplier network was affected by shortages of rare earths, as concerns about the damage from China's restrictions on critical mineral exports deepen.

The move underscores China's dominance of the critical mineral industry, key to the green energy transition, and is seen as leverage by China in its ongoing trade war with U.S. President Donald Trump. China produces around 90% of the world's rare earths.

On Wednesday, German carmaker BMW said that part of its supplier network was affected by the shortage in rare earths, but that its own plants were running as normal.

Europe's auto supplier association CLEPA said several production lines have been shut down due to rare earths shortages, the latest to warn about the growing threat to manufacturing due to the curb.

Of the hundreds of requests for export licenses made by auto suppliers since early April, only a quarter have been granted so far, CLEPA added, with some requests rejected on what the association described as "highly procedural grounds".

It did not identify the companies but warned of further outages.

"Procedures seem to vary from province to province and in several instances IP-sensitive information has been requested," it said, adding that if the process was not streamlined soon, more plants would likely be affected in the next three to four weeks as inventories depleted.

While China's announcement in April coincided with a broader package of retaliation against Washington's tariffs, the curbs apply globally and are causing worry among business executives around the world.