The White House has outlined a US–China trade and economic framework reached in Seoul between President Donald Trump and President Xi Jinping.
The deal pairs tariff relief with a one-year pause on China’s newly expanded rare-earth export controls, alongside steps on fentanyl precursors, semiconductors and agriculture.
Details are still being papered, but the headline direction is a temporary de-escalation.
Headline Commitments
From China
- Suspend the rare-earth restrictions announced 9 Oct 2025 and issue broad general export licencesfor rare earths, gallium, germanium, antimony and graphite—loosening controls tightened in 2022and Apr/Oct 2025.
- Curb fentanyl chemical flows via bans and tighter global controls.
- Roll back retaliation: suspend recent tariffs and non-tariff actions; resume large US soybeanpurchases; facilitate resumption of legacy-chip output from Nexperia plants.
From the US
- Lower by 10 percentage points certain China-related tariffs tied to fentanyl actions and extend Section 301 exclusions to 10 Nov 2026; maintain the 10% reciprocal tariff during the suspension period.
- Pause for one year implementation of designated end-user control expansions and responsive steps under the shipbuilding/logistics Section 301 probe while talks continue.
Context: China’s October measures had been slated to phase in Nov 8 and Dec 1, tightening licences across additional rare-earth products and equipment. The framework pauses that clock for now.
Rhetoric Up but Trust is Thin
US Treasury Secretary Scott Bessent has been blunt that Beijing has proved “unreliable” on critical materials and that Washington must get out from under the “sword” of rare-earth dependency, echoing TV and forum remarks in recent weeks.
The message: this framework buys time, but de-risking from China remains policy even if outright decoupling isn’t the goal.
At the same time, Beijing has cautioned partners against siding with Washington, underscoring that strategic competition continues even as both capitals cool immediate trade frictions.
The upshot: this isn’t a signed treaty, and follow-through on licences, customs guidance and tariff calendars will determine whether the thaw lasts.
Why it matters:
- Temporary relief, not a reset. General licences and paused curbs can ease near-term pressure on EVs, defence and electronics (NdPr, Dy/Tb, graphite, Ga/Ge), but policy risk returns when the one-year window ends.
- Short truces, long memories. Recent ceasefires have been brief; reversals tend to re-ignite escalation, so implementation over the next weeks–months is the critical watch-item.
Semiconductors and Legacy Chips
The framework signals steps to resume output from Nexperia’s China facilities to ease shortages in auto/industrial nodes, while the US pauses new end-user controls for a year—moves aimed at smoothing mature-node supply while broader tech controls remain in place.
Agriculture and Broader Trade
China will buy 12 MMT of US soybeans in late-2025 and 25 MMT annually in 2026–2028, coupled with the suspension of recent retaliatory tariffs across a wide swath of US farm goods.
In parallel, the US extends 301 exclusions and the tariff relief timeline.
What We’re Watching Next
- Implementing rules & licence detail: How broad are the general licences for rare earths/gallium/germanium/antimony/graphite, and how quickly do they hit customs lines?
- REE chain pricing: Reaction in NdPr oxide, Dy/Tb, graphite anode feedstocks, and Ga/Ge; procurement posture at magnet makers.
- Durability beyond one year: Does this pause convert into a codified framework, or do curbs snap back after 2026?
Take for ASX Investors
- Expect a near-term sentiment lift for downstream users that feared imminent REE tightening.
- But the ally-shoring push remains intact: the US continues to fund and fast-track non-China supply with partners (see the fresh US–Australia Critical Minerals Framework, which targets permitting acceleration and ~US$1bn each in near-term financing). North America- or Australia-basedprocessing projects should stay well-positioned.
Bottom Line
The Seoul framework de-escalates immediate tensions around critical minerals and tariffs. It does notunwind the multi-year strategy to diversify supply chains away from single-country dependencies.
Watch the implementation, and be prepared for volatility if either side backtracks.
