Following President Trump’s announcement of a goodwill trade agreement with China, United States Treasury Secretary Scott Bessent stated on Friday that the resolution of issues concerning rare earth minerals and magnet exports from China to the U.S. has addressed the disputes that led to the stalemate in reaching the agreement in May.
In retaliation for the equivalent tariffs announced by the U.S. in April, Beijing had halted the export of various key minerals and magnets, causing a severe impact on the core supply chains of global automobile manufacturers, aerospace manufacturers, semiconductor companies, and military contractors.
During an interview on Fox News’ “Mornings with Maria” show on Friday (June 27), Bessent expressed confidence, saying, “I am now confident that, as agreed by both sides before, these magnets will flow out (of China). At the same time, we have taken countermeasures against China. We have detained some vital supplies for them.”
“This is leadership under President Trump. We have reached a peace agreement, a trade agreement, a tax agreement, respecting each other when dealing with China,” Bessent added.
In May, both the U.S. and China reached an agreement in Geneva, but the transportation speed of key materials such as rare earth did not meet the agreed targets, leading the U.S. to take retaliatory measures. Subsequently, the two sides met in London in June to further reach a consensus on issues related to rare earth. The final agreement is pending approval by respective leaders.
On Thursday (June 26), President Trump announced that a trade agreement had been signed with China on Wednesday, without disclosing the details. White House officials later stated that the U.S. and China had reached an agreement on accelerating the export of rare earth to the U.S.
“Supplementary understanding has been reached between the U.S. government and China on implementing the framework of the Geneva agreement,” officials said, adding that the understanding involves expediting the export of rare earth to the U.S.
On Friday, the Chinese Ministry of Commerce announced that details of the framework for implementing the Geneva trade negotiation consensus between the U.S. and China had been confirmed. While the Ministry stated it would approve export applications for controlled items in accordance with the law, no mention was made of rare earth.
According to a report cited by Reuters from an industry insider, Beijing has imposed dual-use restrictions on rare earth and has been reviewing buyers to ensure rare earth is not diverted for U.S. military purposes, delaying the permit approval process.
The Wall Street Journal reported on Thursday that U.S. companies have been complaining that the Chinese magnets received by their factories in the past two weeks have been barely sufficient and it is difficult to predict future supply situations. Currently, businesses need to wait for weeks for Chinese authorities to review applications. In some cases, applications are rejected, such as those for rare earth raw materials used in magnet production. Some companies have also been compelled to provide sensitive information, such as contact details of magnet buyers, or even the design plans on how magnets are integrated into electrical components.
Due to China restricting the export of key minerals, the Geneva agreement was jeopardized, prompting the Trump administration to implement export control measures to block exports of semiconductor design software, aircraft, and other goods to China.
U.S. Commerce Secretary Howard Lutnick, in an interview with Bloomberg TV on Thursday, stated that the U.S. will only lift the countermeasures once China begins shipping rare earth to the U.S.
Earlier this week, the U.S. Commerce Department informed energy companies that they could load ethane gas onto tankers bound for China, but unloading in China is not authorized without permission.