GraniteShares Plans China-Free Rival as VanEck Rare Earth Fund Hovers Near Its Floor

GraniteShares has filed for a fund that would shut Chinese companies out entirely, a mid-October move that lands as the established VanEck Rare Earth ETF (ISIN IE0002PG6CA6) sits just 2.1% above its 52-week low. The proposed Ex-China Critical Minerals ETF is not yet tradable and its holdings remain undisclosed, but the filing signals that the rare earth investment market is splitting along geopolitical lines.

The distinction matters for anyone holding the VanEck product. That fund tracks the sector broadly, Chinese names included, so every shift in Beijing's export policy washes straight through the whole portfolio rather than a slice of it. A China-free alternative would, by design, insulate holders from exactly that exposure.

Brussels Moves on Several Fronts

Europe's own diversification push is gathering pace. Reuters reported Wednesday, citing internal EU documents, that Brussels is seeking closer ties with Vietnam on critical raw materials, with support measures for mining and processing on the table including loans, grants and export credit insurance. The bloc had already added four rare earth projects to its 2026 strategic project list the same day: two recycling ventures, a refinery and a mining project.

A preliminary EU-China trade understanding meant to steady rare earth supply chains, announced by Trade Commissioner Maroš Šef?ovi?, dates from 9 October and has largely served its purpose as a news hook. What concrete steps it entails is still unknown. Talk from Donald Trump about possible mineral exploration in Greenland has likewise produced no hard new facts, with the island's climate and infrastructure still standing as obstacles to any actual extraction.

Chinese Exports: A Monthly Bounce, a Weak Year

Customs data offer a mixed read. China's September rare earth exports rose 6.7% year on year to 4,269.8 tonnes, though that was down 9.8% from August. For the first nine months, volumes totaled 43,711 tonnes, 9.6% below the same period a year earlier.

The month-on-month recovery points to foreign demand picking up again, but it does nothing to change a weaker full-year picture. None of these releases has been identified as the immediate trigger for the fund's recent slide.

The Numbers Behind the Slide

The ETF closed Friday at EUR 9.61, down 1.1% on the day. Over seven trading sessions the decline adds up to 10%, and over 30 days to 17%. Year to date the fund is off 23%.

Its 52-week low of EUR 9.41 was set on 15 October, leaving just 2.1% of cushion beneath the current price. The gap to the 52-week high of EUR 18.76, reached on 11 May, stands at 49%.

AP reports traced the latest leg down to a broad, tech-driven selloff on Wall Street on Friday, fueled by worries over inflation and debt-financed investment in the AI sector. No specific catalyst for rare earth stocks or the fund itself could be drawn from that. Individual names — USA Rare Earth, United States Antimony and MP Materials among them — logged losses in the first half of October with no confirmed earnings, financing or price trigger.

Corporate Deals Continue Regardless

Company-level activity has carried on independently of the macro mood. NioCorp Developments agreed on Thursday with Traxys North America to sell 50% of planned ferroniobium output plus the entire remaining planned production from its Elk Creek project for the first 15 operating years. The arrangement concerns the individual company rather than the fund, yet it shows supply agreements still being signed while the wider sector absorbs selling pressure.

For the VanEck ETF itself, no issuer announcement, index change or fund-specific flow report has surfaced. The accumulating share class pays no distribution, so no payout date exists for it. Holders are left watching general market sentiment and the political wrangling over trade deals and supply chain diversification.

With roughly USD 969.7 million in assets under management as of 14 October, the fund remains one of the largest of its kind. How it positions itself against more targeted products is a question that is only going to grow louder.