U.S. to get rare-earths imported from China, to allow Chinese students in universities in a much-needed détente

China will remove the curbs it placed on exports of rare-earth minerals and magnets to the U.S.—along with the U.S. allowing Chinese students to attend American universities—as part of its new trade framework, the officials of the two countries said, at the end of two days of intense negotiations in London.

U.S. President Donald Trump said in a post on Truth Social, his social media platform, that the deal with China is done, subject to approval by both Trump and Chinese President Xi Jinping. “Full magnets—and any necessary rare earths—will be supplied upfront by China,” read Trump’s post. Trump also said that the U.S. tariff rate will be a “total” of 55%, which includes a 10% baseline duty, a 20% charge related to fentanyl trafficking, and about 25% from preexisting levies from Trump’s first term as well as most favoured nation rates, Bloomberg reported, citing a White House official.

After the negotiations concluded favourably, U.S. Commerce Secretary Howard Lutnick told the press that the framework deal puts “meat on the bones” of the agreement that was reached in Geneva in May, which notably saw the two countries agree upon a 90-day reprieve on the bilateral, retaliatory tariffs, that had reached 145% for Chinese products in the U.S., and 125% on U.S. products imported in China.

In the contours of the agreement in Geneva, China had agreed to remove the curbs it had placed on rare-earth materials and magnets in April. However, China reneged on removing the curbs, prompting the U.S. to place retaliatory curbs on chip design software, chemicals, and other critical shipments to China.

Lutnick added that the agreement in London will remove the curbs on exports of rare-earth magnets and materials—along with the retaliatory curbs placed by the U.S.—in a “balanced” way, but did not divulge details of the removal of export curbs.

Last week, China announced that it would expedite the approvals of rare earth exports to European companies. However, Nikkei reported that Germany’s importers of rare-earth minerals and magnets are awaiting details, after China cut off the supply of seven rare-earth minerals and magnets to Germany for nearly two months, culminating in some companies exhausting their inventories.

China has a near-monopoly in rare earth magnets, which are critical components in electric vehicles, catalytic converters in gasoline cars, along with a host of consumer electronics. India is also caught in the crosshairs of the export curb, with Maruti Suzuki , India’s largest maker of passenger vehicles, slashing production of its debut electric vehicle, e-Vitara, by two-thirds, according to a Reuters report.