The United States and China have struck a sweeping new trade agreement aimed at defusing months of escalating economic tension, marking the most significant thaw in relations between Washington and Beijing since President Donald Trump took office. The accord, finalized after a bilateral meeting between Trump and Chinese President Xi Jinping in Busan, South Korea, restores chip exports, boosts American agricultural trade, and temporarily lifts restrictions on rare earth minerals critical to Western manufacturing.
According to a White House fact sheet released Thursday, Beijing will "take appropriate measures to ensure the resumption of trade from Nexperia's facilities in China," referring to the Dutch-based, Chinese-owned chipmaker whose exports had been constrained under prior restrictions. The decision to ease the semiconductor ban is expected to ease bottlenecks that rippled across the automotive industry earlier this year, threatening production at companies such as Volvo, Volkswagen, and Jaguar Land Rover.
The new arrangement also includes major agricultural commitments. China will purchase 12 million metric tons (MMT) of U.S. soybeans by the end of 2025, followed by annual imports of 25 million MMT over the next three years, the White House confirmed. Beijing will also resume buying U.S. sorghum and hardwood logs, reopening markets that had been shuttered since trade hostilities began.
For U.S. farmers, the deal represents a financial lifeline. The previous suspension of Chinese soybean imports forced the Trump administration to issue billions in farm aid to offset losses. Agricultural economists say the renewed purchases could provide "much-needed stability" to rural economies still reeling from tariff disruptions and falling commodity prices.
In another concession, Beijing agreed to lift its one-year export restrictions on rare earth minerals-critical materials for aircraft, vehicles, and defense technology. The pause is expected to stabilize global supply chains that had grown increasingly fragile amid China's resource controls.
The agreement also touches on one of Washington's most urgent domestic issues: fentanyl. Under the deal, the U.S. will lower certain tariffs on fentanyl-related imports, while Beijing pledged to implement "significant measures" to restrict the export of precursor chemicals used in producing the deadly synthetic opioid. Fentanyl remains the leading cause of opioid-related deaths in the United States, and American officials have repeatedly pressed China to tighten oversight of its chemical industry.
Despite the optimism surrounding the deal, officials in both capitals warned that the agreement marks a pause, not a resolution, in the broader trade conflict. Treasury Secretary Scott Bessent told CNN that while the administration has no plans to "decouple" from China, Beijing has shown itself to be "an unreliable partner." Trump described the discussions as "amazing," while China's foreign ministry said the two leaders reached a "consensus to resolve major trade issues."
