By Shubhangi Chowdhury
China has given the green light to resume rare earth mineral exports to the United States, just hours after a White House official confirmed that both countries had struck a deal on Thursday. It’s a significant move that marks a step forward in easing tensions, especially in a sector as crucial as rare earth element.
This agreement comes amid weeks of negotiations between the U.S. and China over trade accessibility.
“China is going to deliver rare earths to us, and once they do that, we’ll take down our countermeasures,” U.S. Commerce Secretary Howard Lutnick told Bloomberg News, referring to the export curbs the U.S. had imposed on China.
“China will accelerate the export of rare earths to the United States,” statement given out in response to the comments from President Donald Trump on agreement of the deal.
READ: US, China resume semiconductor tensions after brief truce (May 21, 2025)
Rare earth elements are critical for products ranging from smartphones to fighter jets. These have become a central issue in the ongoing trade tensions between the world’s two largest economies. At the heart of this geopolitical standoff is Baotou, a city in China’s Inner Mongolia region known globally as the hub for rare earth mining and processing. China’s dominance over these materials, essential to industries like aerospace, automotive, semiconductors, and defense, has given it significant leverage in negotiations and global supply chain dynamics.
Back in May in Geneva, the U.S. and China had agreed to scale back steep tariffs that had essentially turned into a trade freeze. But that deal quickly collapsed when the Trump administration grew frustrated with China’s refusal to lift its export controls on rare earth elements which were imposed due to Trump’s so-called reciprocal tariffs, introduced in April.
U.S. hit back with export curbs of its targeting chip software, ethane, and even jet engines. Washington also threatened to revoke visas for Chinese students studying in the United States.
China’s tight grip on rare earth exports had already started affecting America’s defense and tech supply chains. U.S. officials accused Beijing of leveraging its dominance in these critical materials to gain the upper hand in trade talks.
Now, Trump says a new deal is on the table, though formal approval is yet to be done. The U.S. and China have agreed to ease export restrictions, and Chinese students will once again be allowed to study at American universities.
READ: Trump announces 10% tariff on goods from China, will there be retaliation? (February 28, 2025)
“Full magnets, and any necessary rare earths, will be supplied, up front, by China. Likewise, we will provide to China what was agreed to, including Chinese students using our colleges and universities,” said Trump on his social media platform Truth Social.
Reflecting at this from a broader perspective, Trump also dropped a hint about a possible new trade deal with India. While no official details have been released, the suggestion points to a bigger strategy. This might help United States diversify its supply chains and rely less on China for key resources.