Beijing has issued first rare earth magnet export permits

China has issued export permits to at least four rare earth magnet producers including suppliers to Volkswagen , the German carmaker and industry sources said, the first granted since Beijing restricted shipments last month and a sign that the critical materials will continue to flow, reports Reuters.

Baotou Tianhe Magnetics, which makes the magnets used in electric and hybrid car motors, received a licence for Volkswagen in late April, three sources said. One of the sources added that the automaker had reached out to Beijing to help during the process.

"We remain in close contact with our suppliers and have received indications that a limited number of Volkswagen AG's magnet suppliers have been granted export licenses by the Chinese government," Volkswagen said in response to questions from Reuters, declining to provide further detail.

Zhongke Sanhuan received at least one permit, two of the sources said. Baotou INST Magnetic and Earth-Panda Advanced Magnetic Material were also granted at least one permit, one of the sources added.

The four magnet producers and China's commerce ministry did not immediately respond to requests for comments.

Export licenses are granted for each customer and it is unclear whether all clients of the four firms have been cleared by Beijing. One of the sources said permits were only issued to suppliers for customers in Europe and Vietnam.

However, the permits were issued before the trade war truce agreed with Washington on Monday, which industry sources said is likely to make it easier for US customers to win approvals.