In a significant development in the ongoing trade relations between the United States and China, President Donald Trump announced on Saturday, June 7, 2025, that Chinese President Xi Jinping has agreed to resume the export of rare earth minerals to the United States. This announcement came after direct, extensive talks between the two leaders, which Trump described as "very good" and lasting over two hours during their phone conversation.
Trump revealed these details to reporters aboard Air Force One as he traveled from Washington, D.C., to New Jersey. He emphasized that the discussions had made "great progress," noting that while the situation was initially risky and complex, sufficient clarifications had now been secured to move forward with an agreement that could be "very profitable" for the U.S. "The deal will bring us a lot of money and a lot of everything else," Trump said, underscoring the economic importance of this breakthrough.
Rare earth minerals, which include elements critical for the production of smartphones, electric vehicles, and advanced military technology, have long been a focal point of geopolitical and trade tensions. China dominates the global production of these materials, controlling about 90% of the market, giving it considerable leverage in trade negotiations. The materials are essential for the transformation towards green energy and high-tech manufacturing worldwide.
Earlier in the week, Trump had announced that three senior U.S. officials—Treasury Secretary Scott Bissen, Commerce Secretary Howard Lutnick, and U.S. Trade Representative Jamison Grear—would meet with Chinese representatives in London on Monday, June 9, 2025, to discuss the trade agreement in detail. This meeting is viewed as a crucial step toward finalizing the complex deal.
Despite the optimistic tone surrounding the talks, Trump did not shy away from criticizing China’s trade practices. He accused Beijing of violating a previous agreement to suspend tariffs and trade restrictions, stating, "The Chinese did not abide by what we agreed upon... they are difficult to deal with." He also described the task of reaching a comprehensive trade agreement as "daunting," calling President Xi "very stubborn" and accusing the Chinese government of backtracking on earlier understandings made this year.
China’s decision in April to impose export restrictions on a wide range of rare earth minerals and related magnets had escalated tensions, threatening the fragile tariff truce between the two economic superpowers. These restrictions disrupted supply chains for critical sectors including automotive manufacturing, aviation, semiconductors, and military contractors worldwide.
According to Reuters, on June 6, 2025, China granted temporary export licenses to rare earth suppliers serving three major American automakers: Ford Motor Company, General Motors, and Stellantis NV. Some of these licenses are valid for at least six months, although the exact quantities and types of materials covered remain unspecified. The move was seen as a potential easing of the export restrictions that had caused significant supply chain disruptions.
Ford, for example, had to halt production of its Explorer SUV at its Chicago plant for a week in May due to shortages of rare earth minerals. The announcement of the export licenses was welcomed by the market, with Ford’s shares rising by 2.2%, Stellantis shares by 2.4%, and General Motors shares by just under 1% on the morning of June 6.
Stellantis confirmed it was working closely with its suppliers to ensure an efficient licensing process and had managed to address immediate production concerns without major disruptions. Meanwhile, General Motors and Ford declined to comment on the licenses, and the Chinese Ministry of Commerce did not immediately respond to requests for comment.
Industry insiders have described China’s licensing procedures as complex and sometimes causing bottlenecks in supply. However, the recent granting of licenses to American automotive suppliers followed similar permits issued last week to suppliers for an American electronics company and earlier this week to a non-automotive company. This pattern suggests a possible strategic easing of export controls amid ongoing talks.
A source familiar with the situation told Reuters, "We must give the Chinese the benefit of the doubt that they are working to resolve this crisis; the ball is now in their court to prove that they are not using these materials as a political weapon." This comment highlights the delicate balance between economic interests and geopolitical maneuvering in these negotiations.
Adding to the complexity, on June 4, 2025, Reuters reported that China introduced a new tracking system for the rare earth magnet sector to enhance oversight and prevent smuggling. This step reflects Beijing’s intent to maintain tight control over these strategic materials while managing international pressure.
The renewed cooperation on rare earth minerals comes amid a broader context of long-standing trade disputes between Washington and Beijing. These disputes have revolved around tariffs, technology transfer restrictions, intellectual property rights, and competition for global influence. The rare earth minerals issue has become one of the most visible and contentious aspects due to its critical role in modern technologies and military applications.
Trump’s announcement signals a potential thaw in this particular area of tension, with the promise of improved supply chain stability for American industries heavily reliant on these materials. However, it also underscores the ongoing challenges in U.S.-China relations, where progress often coexists with deep-seated mistrust and strategic rivalry.
As the U.S. and China prepare for the upcoming trade talks in London, all eyes will be on whether these negotiations can translate into a durable agreement that balances economic benefits with national security concerns. The rare earth minerals deal could be a bellwether for future cooperation or continued friction in this complex bilateral relationship.
