Trump-Xi meeting leads to US-China tariff cuts, deals on rare-earths, soybean purchases | 5 points

US President Donald Trump said Thursday that he had agreed to cut fentanyl-related tariffs on China to 10% after talks with President Xi Jinping in Busan, South Korea. He added that overall tariffs on Chinese goods would be slashed to 47% from 57% in exchange for Beijing resuming US soybean purchases, keeping rare earths exports flowing and cracking down on the illicit fentanyl trade.

Donald Trump and Xi Jinping held their first face-to-face meeting in six years, aiming to reach a truce in the ongoing trade war that has roiled the world economy.

Among the key issues discussed during the Trump-Xi meeting were the export controls on rare earths announced by Beijing this month.

Trump said the dispute between China and the United States had been "settled". China did not provide an immediate comment on the meeting or any outcomes.

Speaking aboard Air Force One, Donald Trump described the meeting with Xi Jinping as a "great success". The crucial bilateral meeting lasted less than two hours and resulted in five major announcements. They were:

1. Tariff cuts: Trump confirmed that fentanyl-related tariffs on China would be cut from 20% to 10%, effective immediately. He reiterated that overall tariffs would drop from 57% to 47% after talks on fentanyl curbs.

“I expect to be lowering that because I believe that they’re going to help us with the fentanyl situation,” Trump said, adding, “The relationship with China is very good.”

“I believe he’s [Xi] going to work very hard to stop the death that’s coming in,” Trump said.

The US imposed new tariffs on China this year, totalling 30%, linking 20% directly to Beijing's role in fentanyl production. But the tariff rates have been volatile. In April, Trump announced plans to jack the rate on Chinese goods to 145%, only to abandon those plans as markets recoiled.

Then, on 10 October, Trump threatened a 100% import tax because of China's rare earth restrictions.

2. Ukraine war: Trump said he and Xi agreed to "work together" on the Ukraine issue.

"Ukraine came up very strongly. We talked about it for a long time, and we're both going to work together to see if we can get something," he told reporters.

Xi is “going to help us, and we're going to work together on Ukraine." He, however, said, “Sometimes, you have to let them fight, I guess, not a lot we can do.”

3. Soybean purchases: Trump said China would immediately purchase "large amounts" of soybeans. He said Beijing would start buying the oilseed immediately, without providing any details on volumes.

His statement came after China resumed soybean purchases just ahead of talks. China's state-owned COFCO bought three US soybean cargoes, two trade sources told Reuters – the country's first purchases from this year's US harvest.

4. Rare-earths deal: Trump said he clinched a one-year extendable deal with Xi to keep China's rare earths exports flowing. "All the rare earth issue has been settled," he said.

China is the top producer and processor of rare earth minerals, which are needed to make fighter jets, robots, electric vehicles and other high-tech products. China had tightened export restrictions on 9 October.

5. Trump plans China trip: Trump announced his plans to visit China in April for new talks.

"I'll be going to China in April and he'll be coming here sometime after that, whether it's in Florida, Palm Beach or Washington, DC," Trump told reporters on Air Force One.

"A lot of things we brought to finalisation", Trump said, calling Xi a "tremendous leader of a very powerful country".

Trump also mentioned discussions around Nvidia Corp’s chips access, clarifying that China would not receive the company's most advanced Blackwell line.