A recent agreement reached in London between the United States and China has left a key source of tension unresolved: China’s export controls on rare earth minerals vital to U.S. high-tech and defense industries.
The understanding, which came as an implementation framework for a temporary trade truce originally negotiated in Geneva in May, does not include provisions to ease restrictions on the export of highly specialized minerals such as samarium. This rare earth element is essential for manufacturing cobalt magnets used in American F-35 fighter jets, precision-guided weapons, and certain missile systems. China controls nearly 100% of the global samarium supply, leaving the United States entirely dependent on Chinese exports.
According to a report by Reuters, although China agreed to slightly ease restrictions on rare-earth magnets used in the auto industry, it made no commitment to loosening export controls on more specialized materials. The partial concession did little to address the broader strategic concerns of Washington.
U.S. President Donald Trump praised the agreement last week, declaring, “We have everything we need.” The deal reportedly came together quickly following a June 5th phone call initiated by Trump with Chinese President Xi Jinping, after formal trade negotiations had stalled and bilateral tensions had grown.
Despite the public optimism, the agreement appears to lack any formal documentation and has been referred to in U.S. media as a “handshake deal.” According to Trump administration officials cited by Reuters, the White House is increasingly doubtful that a permanent trade accord can be reached before the August 10th deadline, when the 90-day freeze agreed upon in Geneva expires. Officials have raised the likelihood of needing to extend the temporary arrangement.
Further complicating matters is the Biden administration’s continued enforcement of export controls on AI chips and software destined for China—measures Washington has shown no willingness to lift. This dynamic suggests a longer-term reality in which U.S.-China trade is shaped by temporary truces, fluctuating tariffs, and recurring diplomatic friction, rather than durable agreements.