Trump cuts fentanyl tariffs on China to 10% as Beijing delays restrictions on uncommon earths

BUSAN, SOUTH KOREA – OCTOBER 30: U.S. President Donald Trump (R) speaks with Chinese President Xi Jinping during a bilateral meeting at Gimhae Air Base on October 30, 2025 in Busan, South Korea.

Andrew Harnik | Getty Images News

President Donald Trump and Chinese President Xi Jinping emerged from a high-level meeting and announced agreements on tariffs and export controls that would amount to a significant de-escalation of the contentious trade war between the two superpowers.

However, many details about what was achieved remain unclear, while other key sticking points in US-China trade relations appear not to have been discussed at all. Meanwhile, the overall U.S. tariff rate on Chinese imports will remain at historically high levels.

The agreements reached during the meeting in Busan, South Korea, do not constitute a comprehensive trade deal – although Trump claimed after the meeting that they would be ready to sign “pretty soon.”

Still, he praised the summit with Xi as “amazing,” rating it 12 out of 10.

It was the first face-to-face meeting between the two heads of state and government in six years. They spoke for an hour and 40 minutes.

Tariffs, fentanyl, rare earths and soybeans

Key results include an agreement by the US to immediately halve fentanyl-related tariffs against China from 20% to 10%.

Trump told reporters on Air Force One after the meeting that he believes Xi will “work very hard to stop the flow” of the addictive opioid fentanyl and its precursor chemicals into the United States. China has repeatedly promised to reduce fentanyl trafficking to the United States but has been accused by experts of failing to do so.

US President Donald Trump speaks to media representatives on board Air Force One on the way to the USA, October 30, 2025.

Evelyn Hockstein | Reuters

Trump did not provide any further details. A spokesman for China’s Commerce Ministry said in a translated statement that “both sides had reached consensus on issues such as cooperation on fentanyl control,” without elaborating.

Trump said the overall tariff rate on Chinese goods would fall from 57% to 47%.

The tariff cut addresses “a key Chinese issue,” said Han Shen Lin, China director at consultancy The Asia Group, showing that “Beijing’s efforts to curb exports of fentanyl precursors, long unrecognized by Washington, are finally being recognized.”

Trump and Beijing also confirmed that China had agreed to suspend recently announced export controls on its valuable rare earth metals for a year.

Those checks were announced on Oct. 9 and sparked an angry response from Trump, who threatened to increase tariffs against China by 100% starting Saturday.

The US is dropping this tariff threat, Trump confirmed on Air Force One. He added that he expected the one-year postponement of China’s export controls to be “routinely extended.”

However, the statement from China’s Ministry of Commerce simply said that Beijing would suspend the measures for a year and then “review and refine concrete plans.”

China also did not mention the other export control measures it introduced earlier this year that remain in effect.

Chinese companies control most of the global supply chain for rare earths, which are crucial to making a range of products from semiconductors to rockets. Beijing has tightened restrictions on exports of critical minerals over the past two years, with a particular focus on restricting their use for military purposes by other countries.

“China’s influence over the processing of rare earths and critical minerals will continue to emerge episodically, effectively limiting an escalation in bilateral tensions,” Louise Loo, head of Asia economics at Oxford Economics, said in a note on Thursday.

Trump also said that China will buy “enormous quantities” of U.S. soybeans and other agricultural products “starting immediately.”

Harvested soybeans are moved from a grain truck to a storage silo on a farm near Gregory, Arkansas, USA, on Friday, October 24, 2025.

Rory Doyle | Bloomberg | Getty Images

China was the main buyer of US soybeans. Earlier this year, the country halted all purchases of staple foods for months amid the hard-fought tariff war, costing American farmers billions of dollars in lost revenue.

Ahead of the Trump-Xi summit, Chinese company COFCO bought three U.S. soybean loads for shipment in December and January, representing about 180,000 tons of product – but experts point out that this is just a fraction of previous years’ purchases during the fall harvest. For comparison, in October 2024, China purchased nearly 6 million tons of U.S. soybeans, according to USDA data. In all of 2024, China purchased almost 27 million tons.

Soybeans are not specifically mentioned in the statement from China’s Ministry of Commerce, although it said both sides had reached a consensus on “expanding agricultural trade.”

US customs investigations into China’s maritime and shipbuilding industries and Beijing’s countermeasures would also be delayed by a year, the Chinese government said after the meeting.

Trump said he would travel to China in April, followed by Xi’s trip to the United States, without giving a timetable for his Chinese counterpart.

Remain unclear: Nvidia chips, TikTok, Russian oil, Taiwan

Several important issues were not addressed at the meeting, Trump said.

When selling NvidiaTrump said the two sides discussed “a lot of chips,” but not the most advanced Blackwell chips. “They will talk to Nvidia and others about acquiring chips,” he said.

Taiwan is not part of the discussion, Trump said.

The two leaders also sidestepped the issue of China’s purchase of Russian oil, a financial lifeline for the Kremlin, which continues to wage war in Ukraine.

“Ukraine came up very strongly,” Trump said, but “we didn’t really talk about the oil.”

Trump also gave no indication that he and Xi had reached an agreement to prevent the popular social media app TikTok from falling into obscurity in the United States

China’s government said it would “work with the US to properly resolve issues related to TikTok.”

Samuel Boivin | Photo only | Getty Images

Global stock prices fell and gold prices rose 1.2% as investors assessed the impact of a trade peace that came after several months of economic confrontation.

While the trade peace is “welcome news,” it lacks any indication of addressing underlying structural problems – such as China’s industrial overcapacity and non-market economic practices – said Wendy Cutler, senior vice president at the Asia Society Policy Institute.

That means the ceasefire is “fragile and tensions are sure to rise again,” Cutler added.

“Partners and Friends”

Before the meeting, the two leaders struck a conciliatory tone: Trump called Xi “an old friend” with whom he had a “very good relationship,” and Xi stressed that China’s ambitions for economic growth would not undermine Trump’s vision of “making America great again.”

Tensions between the world’s two economic superpowers are at their peak this year. The latest escalation came this month when Beijing imposed export controls and Washington threatened to ban software-enabled exports to China.

The US had in recent days shared details of the deals it wanted to reach with China – from restricting the flow of fentanyl into the US to divesting TikTok from its Beijing-based parent company ByteDance. Customs duties, technical restrictions and rare earths were also discussed.

At the start of the meeting, Xi shook hands with Trump at a photo op at Gimhae Air Base in Busan and called for Washington and Beijing to be “friends and partners” in his opening remarks.

U.S. President Donald Trump and Chinese President Xi Jinping shake hands as they depart after a bilateral meeting at Gimhae Air Base on October 30, 2025 in Busan, South Korea.

Andrew Harnik | Getty Images

The Chinese leader, sitting across the table from Trump, said it was a “great pleasure” to meet the US president for the sixth time, adding that it was only “normal” for there to be “friction every now and then” between the two economic superpowers.

“China’s development goes hand in hand with your vision to make America great again,” Xi said, according to a statement from the Chinese Foreign Ministry.

This conciliatory tone represents a notable change from Xi’s meeting with former U.S. President Joe Biden late last year, where the speech highlighted more “inevitable competition” between the two countries, said Yue Su, chief economist at the Economist Intelligence Unit.

While the agreement still lacks a “strong structural foundation” and can be easily reversed, both sides are likely to stick with it in the short term to signal goodwill, Su added.

—CNBC’s Sam Meredith contributed to this report.