China says rare earth exports to Europe will continue regardless of US trade deal deadline

Commerce Ministry spokesperson He Yadong told CNBC that China was willing to continue approving rare earth licences for Europe, when asked about the impact of the upcoming US deadline.

The assurance follows a turbulent year in global rare earth trade. Beijing tightened restrictions on all exports of rare earths last October, applying the controls to products containing even 0.1 per cent China-sourced rare earths. The move came after a new US rule expanded an American blacklist to cover majority-owned subsidiaries of Chinese companies on an entity list, potentially affecting some 20,000 Chinese entities.

Washington and Beijing agreed to suspend both measures for one year at a meeting in late October 2025 between President Xi Jinping and President Donald Trump. Ahead of the leaders' latest summit last month, US Treasury Secretary Scott Bessent said the truce was extended by two months, to January.

Trade tensions between the EU and Beijing cooled last week after European trade commissioner Maroš Sefčovič met Chinese Commerce Minister Wang Wentao in Beijing. China said it was willing to use a "green channel" mechanism to keep rare earths flowing to Europe, while asking the bloc to support China's imports of certain products in dual-use sectors.

European Commission leaders are meeting in Brussels on Thursday and Friday and are expected to review details of the trade negotiations with China.

Analysis

Why This Matters

Rare earths are critical inputs for European manufacturing, including defence, electronics and clean energy, and China dominates global supply and processing.
Beijing is signalling that its export policy toward Europe will not be held hostage to the US-China trade truce, which expires in January.
A functioning EU-China channel could offer a model for managing strategic mineral dependencies while the US relationship remains volatile.

Background

China has long been the dominant producer of rare earths, which are essential for the powerful magnets used in electric vehicles, wind turbines and military equipment. Over the past year, export controls have become a central tool in the trade rivalry between Beijing and Washington, with each side suspending measures after a summit between the two leaders in October 2025. The EU, which has sought to diversify its critical mineral supply, has been drawn into the same disputes over restricted exports and market access.

Key Perspectives

China: The commerce ministry says rare earth supplies to Europe will continue and has offered a "green channel" mechanism, while seeking EU support for Chinese imports in dual-use sectors. European Union: The European Commission is reviewing negotiation details after the Sefčovič-Wang meeting and appears willing to stabilise trade ties with Beijing. United States: The administration holds a truce that now runs to January, with Treasury Secretary Scott Bessent confirming a two-month extension, but the underlying blacklist and export controls remain suspended, not resolved. Critics and sceptics: China's assurances are conditional, and the export regime remains a source of leverage. European dependence on Chinese rare earths would persist even if the green channel operates as promised.

What to Watch

Whether the European Commission leaders' meeting in Brussels this week produces a formal position on the China trade talks.
The January deadline for the US-China truce and any further extension.
Whether the "green channel" mechanism translates into concrete export licences for European buyers.
EU decisions on Chinese imports in dual-use sectors, which Beijing has linked to continued rare earth flows.

Analysis

Why This Matters

Background

Key Perspectives

What to Watch

Sources