Big Take Xi’s Rare Earths Bargaining Chip Is a Trade War Game Changer
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Oct 22, 2025 
In this discussion, Daniel Ten Kate, Bloomberg's Executive Editor for Government and Economics in Asia, shares insights on how China's dominance in rare earths creates leverage in trade negotiations with the U.S. He highlights the implications of China's new export restrictions and its strategic control of production and processing technology. The conversation dives into the historical context of China’s rare earth strategy and explores the challenges the U.S. faces in building an independent supply chain, all while navigating a high-stakes meeting between Trump and Xi.
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China's Rare-Earth Leverage Shifted The Balance
- China's rare-earth leverage forced the U.S. to back down in trade talks and is a game changer.
- Daniel Ten Kate says Xi gained a unique strategic advantage by wielding that leverage effectively.
Rules Reach Beyond Minerals To Finished Products
- New Chinese rules claim control over any product containing even trace rare earths and require licenses.
- Daniel Ten Kate warns this asserts the right to intervene broadly without necessarily stopping global trade.
Processing, Not Just Mining, Is China's Stronghold
- China controls about 70% of supply and nearly all processing technology for rare earths.
- That processing dominance, not just raw minerals, is the core problem for the U.S. and partners.