How US-China trade talks are a techno-economic chess match
The United States and China may continue to trade, however the reasoning of that trade is now governed by mistrust and resilience-building, not effectiveness or growth.
China manages roughly 90 per cent of global rare earth processing, and over 69 per cent of rare earth mining, including crucial inputs such as dysprosium, neodymium, and samarium. A 90-day truce negotiated in Geneva on May 12 temporarily reduced U.S. tariffs from 145 per cent to 30 per cent and China’s from 125 per cent to 10 per cent, but it has proven delicate. Despite a headline 4.8 per cent year-on-year increase in exports in May, shipments to the US dropped 34.5 per cent, worsening from -21.0 per cent in April.
China manages approximately 90 per cent of global rare earth processing, and over 69 per cent of rare earth mining, including vital inputs such as neodymium, dysprosium, and samarium. Rare earth exports to the U.S. dropped by 72.4 per cent year-on-year in May, following a 55.2 per cent drop in April. A 90-day truce negotiated in Geneva on May 12 temporarily reduced U.S. tariffs from 145 per cent to 30 per cent and China’s from 125 per cent to 10 per cent, but it has proven vulnerable. Semiconductor-reliant production output decreased 1.2 per cent month-on-month in May, and automobile exports from Michigan to Canada have collapsed, falling from a standard of 75,000 units/month in Q1 to just 14,500 in May, a mere 18.6 per cent of the 2024 monthly average. Despite a headline 4.8 per cent year-on-year increase in exports in May, shipments to the United States dropped 34.5 per cent, worsening from -21.0 per cent in April.
