Lynas Rare Earths (ASX:LYC) expects to commission and ramp up dysprosium and terbium oxide production capacity within the year, which is expected to provide a modest uplift in earnings, said Euroz Hartleys in a Monday note.

On Friday, China unveiled retaliatory export control measures on certain items related to medium and heavy rare earths, a move that's a "major" sector-wide development, according to the research firm.

The research firm believes the potential extension of export controls to neodymium and praseodymium on further trade tensions would make listed rest of the world rare earth elements company exposures a must-own.

Euroz Hartleys maintained a buy rating with a price target of AU$8.