According to the Wall Street Journal:
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China to limit rare-earth export licenses to U.S. automakers and manufacturers to six months, adding leverage and uncertainty amid trade tensions.
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The temporary licenses were restored after two days of intense talks in London, following a Geneva agreement last month.
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In exchange, U.S. agreed to ease restrictions on sales of jet engines, parts, and ethane (used in plastics manufacturing).
Framework details are still being finalized; the White House declined to comment. Lutnick spoke earlier but did not mention the six month limit..China has agreed to begin approving rare-earth license applications immediately, pending final sign-off by President Trump and Chinese leader Xi Jinping. If the agreement is approved, licenses could be issued within a week. As the approvals move forward, the U.S. will start lifting its countermeasures, including export controls. President Trump stated that the deal is effectively done, subject to final approval, and declared that “FULL MAGNETS, AND ANY NECESSARY RARE EARTHS, WILL BE SUPPLIED.” The rare-earth elements covered under the licenses will primarily serve sectors such as electric vehicles, wind turbines, consumer electronics, and military equipment. However, despite the trade truce agreed upon in Geneva in May, both Washington and Beijing have since accused each other of undermining the agreement
This article was written by Greg Michalowski at www.forexlive.com.
