US-China Trade Talks: Trump & Xi Near Deal on Tariff, Rare Earths

US-China Trade Talks: Trump Tariff, Rare Earth, Port Fee, Nvidia Boost

US President Donald Trump and Chinese President Xi Jinping are moving toward a temporary trade truce, aiming to ease tariffs, lower port fees, and stabilize tensions ahead of their APEC summit meeting.

Breaking Developments: US-China Trade Talks

President Donald Trump has signaled a softer approach toward China ahead of his meeting with President Xi Jinping. Trump announced that he plans to lower the Fentanyl tariff on China and is “working something out” regarding rare earth minerals, hinting at easing tensions between the two countries.

Source: The Kobeiisi Letter X

Trump also revealed that he will speak with President Xi about Nvidia’s ($NVDA) Blackwell chip, adding that Nvidia CEO Jensen Huang presented him with a Blackwell chip in the Oval Office. 

With this announcement, the Nvidia stock shot up in overnight trading as it indicated the optimism of investors regarding the possibility of a collaboration between the US and the Chinese tech industries.

To further enhance the positive trend, The Wall Street Journal also indicated that the US and China are about to cut port charges on goods being shipped between the two countries - a step that is meant to ease trade logistics and lower shipping expenses.

Source: X

Upcoming Trump–Xi Meeting

The highly anticipated Trump–Xi meeting will take place on the sidelines of the APEC Summit in Gyeongju, South Korea — their first face-to-face interaction since 2019.

The main goal of the meeting is to “lower the temperature” in the ongoing US-China rivalry, but experts caution that expectations should remain modest. The talks are expected to focus on preventing further escalation rather than completely resolving trade disputes.

Trump China Trade War 

While the meeting may bring temporary relief, it is unlikely to undo the existing tariffs and sanctions.

Key elements under discussion include:

• China is deferring its planned rare earth export restrictions (due to start December 1).

• Increasing purchases of US soybeans.

• Strengthening cooperation to curb fentanyl-related chemicals.

• Closing a TikTok deal to make it compliant with US laws.

• Trump, in his turn, can withdraw his intended 100% tariff on Chinese products.

These discussions notwithstanding, the tariff rates are still high - the average US tariff on Chinese goods is approximately 55% and the average tariff of China on US imports is approximately 32%.

Source: X

Ongoing Frictions: Rare Earths

Despite a prospective agreement, there is still intense tension between the two superpowers. The US continues to blacklist a number of Chinese companies due to a purported threat to national security, and China has already limited exports of rare earths and opened investigations into Nvidia and Qualcomm.

The trade data is indicative of the stress: exports of China to the US have fallen by 27% in September, and it is the sixth month in a row of decreasing exports. In the meantime, the US imports dropped by 16%, indicating that business relations continue to decline in spite of the diplomatic work.

Expert Opinions

Trade analysts believe the Trump–Xi summit could ease tensions temporarily, but they see no long-term resolution in sight.

“The structural contradictions between both country remain unresolved,” said one trade expert.

Other analysts believe that there will be a temporary ceasefire in trade tensions, which will probably last a year, because the US is still relying on China to supply it with rare earths. Nevertheless, it is not likely to have a comprehensive trade deal until subsequent negotiations in 2026.

Conclusion

Trump is of the view that the US has been ripped off by the Xi country and demands better terms. On the contrary, Xi still urges respect and cooperation mutually in win-win situations.

So far, the meeting has provided some relief in the tensions; however, the two countries are engaged in a long-term economic competition, which is not expected to come to an end in the near future.