U.S. President Donald Trump takes questions from the media at the White House in Washington, D.C., U.S., May 7, 2025.
Leah Millis | Reuters
U.S. President Donald Trump Wednesday said that China will supply rare earths upfront to the U.S. as part of a trade agreement.
The relationship between the world’s two largest economies is “excellent,” Trump said in a post on Truth Social, while adding, “WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%.”
He added that magnets and “any necessary rare earths” will be supplied up front by China and that the U.S. will in turn make certain concessions such as allowing Chinese students to attend U.S. colleges and universities.
The agreement is subject to final approval with himself and China President Xi Jinping, the White House leader said.
Representatives from both sides had on Tuesday revealed that a deal had been reached on trade after a second day of high-level talks in London.
“We have reached a framework to implement the Geneva consensus and the call between the two presidents,” U.S. Commerce Secretary Howard Lutnick told reporters.
Tensions escalated after China imposed export restrictions on several rare earth elements and magnets used by the automotive and defense sectors.
China is the undisputed leader of the critical minerals supply chain, producing roughly 60% of the world’s supply of rare earths and processing almost 90%, which means it is importing these materials from other countries and processing them.
U.S. officials have previously warned that this dominance poses a strategic challenge amid the pivot to more sustainable energy sources.
Oil prices popped on the news. International benchmark Brent crude futures with August delivery rose $1 a barrel to $67.87 shortly after Trump’s social media post. The contract was last seen up around 1.5% for the session.
U.S. West Texas Intermediate futures with July delivery, meanwhile, stood 1.8% higher at $66.14.