On June 9, 2025, high-stakes trade talks between the United States and China are set to resume in London, centering on the contentious issue of rare earth minerals export. This meeting marks a critical juncture in efforts to ease tensions between the world’s two largest economies, particularly regarding China’s dominant position in the rare earth metals market.
Leading the U.S. delegation are Treasury Secretary Scott Bessent, Minister of Trade Howard Lytnyk, and U.S. Trade Representative Jamison Greer. They will meet with a Chinese delegation headed by Vice Premier He Lifeng. The talks follow an agreement reached in Geneva last month, which aimed to curb the escalating trade war that began in February 2025. However, mutual accusations of breaching that agreement have complicated progress.
Rare earth minerals—vital components in the manufacturing of cell phones, electric vehicles, and advanced technologies—have become a focal point of strategic leverage. China controls approximately 70% of the world’s rare earth mining and over 90% of the processing capacity, giving it unparalleled influence over global supply chains. Experts note that China’s use of export controls on these materials has shifted the balance of power in negotiations.
President Donald Trump first highlighted the rare earth issue publicly after a phone call with Chinese President Xi Jinping on June 5, 2025. Trump indicated a breakthrough, stating, "There will be no more questions about the complexity of rare earth products." The following day, he announced that Xi had agreed to resume the supply of rare earth minerals and magnets to the U.S., a move that could alleviate some supply chain pressures.
Jin Chan-long, a professor of international relations at People's University, commented on the situation on June 6: "Rare earth is a secret card held by China. The United States is trying to resolve the rare earth problem as soon as possible." He added that Trump's emphasis on rare earths in social media posts underscores the issue's critical importance and China’s effective use of this leverage.
The rare earth export controls have not only impacted the U.S. but also European Union industries. On June 3, Chinese Commerce Minister Wang Wentao met with EU Trade and Economic Security Commissioner Marosi Shepchowicz to discuss the challenges faced by European automakers and manufacturers in procuring rare earth magnets. In response, China’s Ministry of Commerce announced the establishment of a "green passage"—a fast-track approval process—to expedite rare earth exports to the EU under certain conditions.
On June 7, China’s Ministry of Commerce further declared it was granting conditional export licenses for rare earths, stating, "We note that the demand for rare earths in each country continues to increase with the development of the robot and electric vehicle industries. China is reviewing applications for rare earth export permits with full consideration of each country's demand and concerns, and is willing to promote legal trade by expanding communication with related countries." This move suggests a willingness to balance strategic control with international trade obligations.
Despite these developments, tensions remain high. The U.S. alleges that China has not fully lifted export restrictions as promised under the Geneva agreement, while China counters that U.S. sanctions continue to hamper trade relations. The White House has warned that if no agreement is reached, President Trump intends to reinstate tariff rates announced in April 2025 or impose lower tariffs exceeding the current base level of 10%. The current suspension of some duties is set to expire in August 2025 unless extended.
Josh Lipsky, head of international economics at the Atlantic Council, offered insight into the negotiations, saying, "The US and China just want to go back to what they had in Switzerland, get a few more deals on paper to really understand what will be licensed, what will be allowed and what won't." This highlights the desire on both sides to clarify terms and reduce uncertainty for businesses and investors.
The upcoming London talks are the first follow-up meeting since the Geneva deal and the second high-level meeting since the trade war began. China's Deputy Prime Minister Heipeng’s visit to the UK from June 8 to June 13 will also include the inaugural meeting of the economic and trade negotiation mechanism between the two countries, underscoring the importance of sustained dialogue.
China’s strategic deployment of rare earth export controls has altered the offensive and defensive dynamics of the trade dispute. By leveraging its near-monopoly, China has gained unprecedented negotiating power, capable of triggering cascading effects on the U.S. manufacturing supply chain. This has compelled the U.S. to prioritize resolving rare earth supply issues swiftly to mitigate industrial disruption.
As the world watches, the outcome of these talks will have far-reaching implications. A successful agreement could ease tensions and stabilize global supply chains critical to technology and manufacturing sectors. Conversely, a breakdown could reignite tariff escalations and deepen economic uncertainty.
For now, the rare earth minerals remain at the heart of a complex geopolitical chess game, where economic interests, technological dominance, and diplomatic strategy intersect. The London negotiations on June 9 will be pivotal in shaping the next chapter of U.S.-China relations.
