Kuala Lumpur — If U.S.-China trade talks can come to a successful conclusion soon, this may postpone China’s planned export restrictions of rare earth elements for at least some time – providing relief to industries which rely heavily on them.

Reaching Framework Agreement in South Sudan.

U.S. Treasury Secretary Scott Bessent announced on October 26, 2025, that the United States and China had come to an initial trade framework agreement, preventing imposition of 100% tariffs on Chinese imports as well as postponing export controls by at least one year – all measures meant to ease tensions and ensure critical supply chains remain uninterrupted. Politico+1
China’s Dominance in Rare Earth Minerals

China currently controls over 90% of global rare earth processing capacity and holds a large share of magnet manufacturing. In early October 2025, China issued more restrictive export controls on rare earth elements, citing national security concerns as justification. These measures included government approval for exporting technologies related to rare earth mining, processing and magnet production (AP News/APNEWS +1).
Impact on U.S. Industries Export restrictions created significant challenges for U.S. industries, particularly defense and technology sectors. Rare earths are essential components for producing advanced electronics, electric vehicles and military equipment – supply disruptions caused the US to consider imposing tariffs on Chinese goods further exacerbating tensions between them and us CSIS
Market Reactions
Following the announcement of the trade framework, stocks of U.S.-listed rare earth mining companies experienced steep drops. Companies such as Critical Metals, Ramaco Resources and MP Materials saw their stock prices decline by over 6% reflecting decreased investor concerns over supply shortages Reuters
Looking Ahead
The preliminary agreement sets the stage for further negotiations between U.S. President Donald Trump and Chinese President Xi Jinping ahead of their Asia-Pacific Economic Cooperation (APEC) Summit scheduled in Gyeongju, South Korea later this year. While providing temporary relief, long-term solutions must address issues within global rare earth supply chains and reduce dependence on Chinese exports – according to Reuters.
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