U.S. President Donald Trump meets Chinese President Xi Jinping this week with a key part of his trade strategy still unfinished: securing a homegrown supply of critical minerals to counter Beijing's dominance, Reuters reported on Sunday.
The meeting, expected on Thursday on the sidelines of the Asia-Pacific Economic Cooperation summit in Shenzhen, will test whether Trump can press Xi on minerals without risking the very supplies American manufacturers depend on.
China Still Holds the Leverage
Many U.S. mining and processing projects remain years from production despite billions of dollars in federal investment by the Trump administration, leaving American manufacturers dependent on Chinese materials essential to semiconductors, robotics, weapons systems and the artificial intelligence boom.
China is the world's top rare earths miner and has used that position as leverage in negotiations. Last year, Beijing restricted exports of the minerals and magnets, disrupting work at Ford Motor and other U.S. manufacturers. Washington negotiated for continued access, and China has said it restricted the minerals to prevent their use in war.
According to half a dozen analysts interviewed by Reuters, Trump can press Xi only so hard on tariffs and export controls without risking access to metals, magnets and chemical compounds that the United States does not produce in sufficient quantities.
U.S. Projects Years Away From Production
The gap between ambition and output is stark. A $7.4 billion Tennessee refinery for copper, zinc and other critical minerals backed by South Korea's Korea Zinc is not expected to open until 2030. Vulcan Elements has begun making rare earth magnets in North Carolina, although its customers have not yet approved them for use.
America's manufacturing capacity for neodymium-iron-boron magnets — used in electric vehicles and military equipment — was roughly 4,500 metric tons annually in 2025, a fraction of what the world's largest economy consumes.
What the Talks Could Produce
Trump and Xi may agree to extend their existing trade truce, which is due to expire in January and includes export-control waivers for certain critical minerals. China has already extended its pause on rare earth export curbs to January 10, and the truce has suspended a 24 percent tariff on U.S. goods while a 10 percent charge stays in place.
The Busan trade agreement at the centre of the talks capped U.S. tariffs on Chinese goods at about 20 percent, with China pledging to buy 25 million metric tons of U.S. soybeans over three years and to keep rare earth exports flowing. But U.S. officials say Beijing has delivered only about two-thirds of its commitments — a claim Beijing disputes — and Treasury Secretary Scott Bessent and U.S. Trade Representative Jamieson Greer warned Chinese Vice Premier He Lifeng in a call last week that Beijing must immediately implement the deal.
Political Pressure at Home
Trump's minerals strategy also faces a political test at home. Democrats' midterm victories will give them control of Congress next year, and some have questioned the administration's investments in private companies. U.S. Energy Secretary Chris Wright, whose department funded multiple minerals projects, said last week he was "happy to explain everything we've done."
Thursday's meeting will show whether the world's two largest economies can turn a fragile truce into something more durable — or whether the minerals gap leaves Washington negotiating from a position of dependence.
Source: Reuters