US says deal with Beijing will expedite rare earth exports from China

Highlights: 

• China had committed to removing non-tariff countermeasures in May talks
• China's dual-use restrictions slow rare earth licensing process
• Trump says there might be a separate deal with India

The United States has reached an agreement with China on how to expedite rare earth shipments to the US, a White House official said on Thursday, amid efforts to end a trade war between the world's biggest economies.

President Donald Trump earlier said the United States had signed a deal with China on Wednesday, without providing additional details, and that there might be a separate deal coming up that would "open up" India.

During US-China trade talks in May in Geneva, Beijing committed to removing non-tariff countermeasures imposed against the United States since April 2, although it was unclear how some of those measures would be walked back.

As part of its retaliation against new US tariffs, China suspended exports of a wide range of critical minerals and magnets, upending the supply chains central to automakers, aerospace manufacturers, semiconductor companies and military contractors around the world.

"The administration and China agreed to an additional understanding for a framework to implement the Geneva agreement," a White House official said on Thursday.

The understanding is "about how we can implement expediting rare earths shipments to the US again", the official said.

A separate administration official said the US-China agreement took place earlier this week.

US Commerce Secretary Howard Lutnick was quoted as saying by Bloomberg: "They're going to deliver rare earths to us" and once they do that "we'll take down our countermeasures."

On Friday, China's commerce ministry said the two countries recently confirmed details on the framework of implementing the Geneva trade talks consensus. It said China will approve export applications of controlled items in accordance with the law. It did not mention rare earths.

While the agreement shows potential progress following months of trade uncertainty and disruption since Trump took office in January, it also underscores the long road ahead to a final, definitive trade deal between the two economic rivals.

China has been taking its dual-use restrictions on rare earths "very seriously" and has been vetting buyers to ensure that materials are not diverted to US military uses, according to an industry source. This has slowed down the licensing process.

The Geneva deal had faltered over China's curbs on critical minerals exports, prompting the Trump administration to respond with export controls of its own preventing shipments of semiconductor design software, aircraft and other goods to China.

In early June, Reuters reported China had granted temporary export licenses to rare-earth suppliers of the top three US automakers, according to two sources familiar with the matter, as supply chain disruptions began to surface from export curbs on those materials.

Later in the month, Trump said there was a deal with China in which Beijing would supply magnets and rare earth minerals while the US would allow Chinese students in its colleges and universities.