US-China Rare Earths Deal Aimed for Thanksgiving
US Treasury Secretary Scott Bessent said on Sunday that a deal on rare earth minerals between the United States and China is expected to be finalised by Thanksgiving Day. The agreement follows a framework reached last month in which the US agreed not to impose proposed 100 % tariffs on Chinese imports of these minerals, and China committed to delay implementing a new export licensing system for critical rare earths and magnets.
Key Elements of the Deal
According to Bessent, the deal was negotiated after a meeting between Donald Trump and Xi Jinping in South Korea, and he expressed confidence China will honour its commitments. He also rejected a report claiming China plans to systematically restrict rare-earth exports to US firms linked with the military, calling the claim inaccurate.
Strategic Importance
Rare earth metals are vital for everything from electric vehicles and smartphones to military systems and wind-turbine generators. China dominates large portions of the global supply chain, giving it significant leverage in trade talks. A finalised deal would ease supply-chain concerns for the US and could reduce trade tensions, but analysts warn that previous deals have been delayed or unravelled at the last minute.
Outlook and Risks
While the timeline for Thanksgiving is ambitious, Bessent cautioned that if China fails to adhere to the framework, the US retains “many levers” for response. The deal’s success hinges on detailed implementation, including how licensing and export controls will be managed and monitored. Markets and industries tied to critical minerals will be watching closely for clarity on the next steps.
