From Foreign Policy · Christina Lu · · 2m
Xi's rare-earth leverage over Trump
As the two leaders meet, China's control of critical minerals gives Beijing a powerful negotiating tool the U.S. still can't counter.
In brief
As the two leaders meet, China's control of critical minerals gives Beijing a powerful negotiating tool the U.S. still can't counter. China will dominate rare-earth supply chains until at least 2030, meaning U.S. dependence on Chinese minerals will persist for years regardless of trade deals. Originally reported by…
Xi arrives with rare-earth leverage
Chinese President Xi Jinping meets Trump this week armed with control over rare earths, critical minerals the U.S. desperately needs for defense and technology.
The rare-earth conflict began in 2025
After Trump imposed tariffs in April 2025, China retaliated with rare-earth trade restrictions, triggering escalations that led to a one-year trade truce expiring in November.
U.S. rare-earth supplies remain weak
Despite aggressive efforts to reduce mineral vulnerabilities, Chinese rare-earth flows have fluctuated. U.S. Trade Representative Jamieson Greer gave China only a passing grade on exports, and shipments dropped again in August.
“China only gets a "passing grade" on its rare-earth exports”
Trump has no answer to China's card
Analysts say Trump still lacks a strategy to counter China's rare-earth leverage as the summit approaches, with discussions potentially covering AI and Taiwan.
Both sides want the truce extended
Analysts expect limited outcomes from the summit, but both parties believe extending the trade truce serves their interests. Neither wants to escalate further.
“Neither side wants to blow this up”
China dominates rare earths until 2030
Bloomberg Economics estimates China will control rare-earth supply chains from mining through magnet production until at least 2030, cementing its leverage for years.
U.S. dependence will persist for years
Even if all announced Trump administration projects deliver on schedule, Washington's dependence on Chinese rare earths will likely persist until the early to mid-2030s.
“the dependence remains”
Supply chains are deeply intertwined
U.S. dependence is extensive because Chinese goods are embedded at every production stage. Even magnet production in Japan relies on Chinese inputs and technology.
Iran war exposes military vulnerabilities
The Iran conflict has depleted U.S. munitions supplies, exposing the defense sector's reliance on rare earths. Trump ordered defense contractors to stop sourcing from China by January 1.
Defense companies struggle with timeline
Some defense contractors are scrambling to meet the January 1 deadline to stop sourcing rare earths from China, while also rebuilding munitions stockpiles depleted by the Iran war.
A truce extension is likely coming
U.S. Trade Representative Greer has suggested Washington could support a three-to-six-month truce extension, signaling both sides will likely avoid escalation at the summit.
The bottom line
China will dominate rare-earth supply chains until at least 2030, meaning U.S. dependence on Chinese minerals will persist for years regardless of trade deals.
