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US President Donald Trump has imposed tariffs as high as 245% on Chinese imports — his most dramatic economic strike yet — in direct response to Beijing’s tightening export controls over critical minerals used in everything from smartphones and EVs to jet engines and nuclear submarines.
Trump’s latest move, announced through a sweeping April 15 executive order, directs the commerce department to investigate whether imports of critical minerals and derivative products pose a national security threat. That investigation could result in even more trade penalties under Section 232 of the Trade Expansion Act.
“If the Secretary of Commerce submits a report finding that imports of critical-mineral articles threaten to impair national security and the President decides to impose tariffs, any resulting tariff rate imposed under Section 232 would take the place of the current reciprocal tariff rate, pursuant to President Trump’s April 2 order,” the White House said in a fact sheet.
Why it matters
Rare earth elements and other critical minerals aren’t just industrial inputs — they’re the backbone of the US defense industrial base.- “Critical minerals, including rare earth elements, are essential for national security and economic resilience,” the White House said.
- Rare earths — a group of 17 critical elements — are essential to industries ranging from defense and electric vehicles to energy and electronics. The US has just one operational rare earth mine, and relies heavily on China for nearly all of its processed supply.
- China dominates 92% of global processing capacity for rare earths.
- The US relies on China for about 70% of its rare earth compound and metal imports.
- Trump officials say China is using that dominance as a geopolitical weapon — and the US can’t afford to wait.
- “An overreliance on foreign critical minerals… could jeopardize US defense capabilities, infrastructure development, and technological innovation,” the White House said in its statement.
Processed critical minerals and their derivative products are key building blocks of our defense industrial base and integral to applications such as jet engines, missile guidance systems, advanced computing, radar systems, advanced optics, and secure communications equipment.
White House Fact Sheet
Zoom in: Why 245%?
- The 245% tariff comes on top of a broader, aggressive trade strategy:
- A 10% baseline tariff on all imports across the board.
- An earlier 34% “reciprocal” tariff on Chinese goods.
- Additional 125% tariffs imposed over trade practices the US deems unfair.
- A 20% tariff tied to China’s alleged role in fentanyl trafficking.
- “China now faces up to a 245% tariff on imports to the United States as a result of its retaliatory actions,” the White House said.
Here are the key reasons behind the Trump administration’s latest move:
Critical minerals as strategic assets: The White House explicitly framed the move as a response to growing dependence on China for critical minerals like gallium, germanium, antimony, and rare earths—materials essential to advanced weapons, secure communications, and cutting-edge manufacturing. These aren’t just economic inputs; they’re the foundation of national defense.
China’s export restrictions: The tariffs follow Beijing’s decision to restrict exports of multiple rare earth metals and magnets, viewed in Washington as an attempt to strangle US and allied industries. This includes sectors like aerospace, EVs, and semiconductors—industries the US sees as strategically vital.
Weaponized supply chains: US officials accuse China of using its dominance in critical supply chains as geopolitical leverage—citing price manipulation, overcapacity, and arbitrary export bans as forms of economic coercion.
Retaliation and escalation: China has responded to prior U.S. tariffs with its own countermeasures, including blocking Boeing jet deliveries and targeting US agriculture. The 245% rate reflects a direct escalation—an attempt to punish and pressure China simultaneously.
Closing loopholes: Trump’s administration has eliminated previous exemptions and “de minimis” thresholds—like the under-$800 tax-free rule that benefited Chinese e-commerce giants Shein and Temu—aiming to shut every backdoor in the tariff regime.
The big picture: A mineral arms race
This isn’t just another chapter in a trade dispute — it’s a strategic resource war.
Back in 2019, Chinese President Xi Jinping visited a rare earth factory in Ganzhou and declared: “Rare earths are a vital strategic resource.” Six years later, China’s grip on these materials is tighter than ever, a CNN report said.
Rare earths are used in F-35 fighter jets, guided missiles, smartphones, MRI machines, and advanced radar and communications systems.
Just this month, China suspended exports of six heavy rare earths and rare earth magnets, choking off key components used by aerospace firms, automakers, and military contractors.
Beijing’s message is clear: If Trump escalates, so will China.
What they’re saying
Industry insiders confirm the impact is already being felt.
“Right now, literally these exports are being suspended,” Joshua Ballard, CEO of USA Rare Earth, told CNN. “We don’t hold a lot of back stock of this in inventory here in the US… This is China’s best play. They don’t have much leverage when it comes to tariffs on us, but they sure do have leverage here.”
John Ormerod, founder of JOC, a rare earth magnet consultancy, told CNN that at least five US and European companies have had shipments frozen in China: “There’s a lot of confusion on their side and they needed clarification from the authorities.”
In 1992, during a visit to one of the country’s main rare earth production hubs in Inner Mongolia, Deng Xiaoping, the former Chinese leader who spearheaded the country’s economic reforms, famously said: “While there is oil in the Middle East, China has rare earths.” Today, China has fulfilled Deng’s vision by dominating the entire supply chain for the materials.
An article in CNN
What’s next: Rebuilding American industry
The US is scrambling to close its mineral vulnerability gap. Three American companies say they are expanding capacity or partnering with allies like Australia and Canada to reduce dependence on Beijing.
Phoenix Tailings, a Massachusetts-based start-up, has developed zero-waste, zero-emission rare earth processing tech. “It’s all domestic processing. We don’t rely on anything from China,” CEO Nicholas Myers told CNN.
USA Rare Earth is building a magnet plant in Texas, aiming for 5,000 tons of production per year, and developing a West Texas deposit rich in gallium and other banned materials.
The defense department has invested $439 million since 2020 to rebuild the supply chain. The goal: a fully domestic “mine-to-magnet” system by 2027.
But industry leaders warn time is not on their side. “The question is how do we do this faster?” Ballard asked. “We need to unlock what we have and build as quickly as we can.”
What Trump says: In typical fashion, Trump says China needs to come to the table — not the US.
“The ball is in China’s court. China needs to make a deal with us. We don’t have to make a deal with them,” said press secretary Karoline Leavitt, reading Trump’s message aloud at the White House.
Trump has also slammed Beijing for reneging on a major Boeing aircraft deal, claiming the country has “zero respect” for Joe Biden’s administration and failed to deliver on past trade pledges.
China’s rebuttal: Beijing, unsurprisingly, sees it differently.
Reacting to the White House’s statement claiming China now faces up to 245% tariffs on imports to the US, Chinese foreign ministry spokesperson Lin Jian said they should ask the US side for the “specific tax rate figures.”
While addressing a press briefing on Wednesday, Lin said that China has repeatedly stated its solemn position on the tariff issue. He said that the tariff war was initiated by the US and that Beijing has taken countermeasures to protect its legitimate rights and interests and international fairness and justice, terming it completely “reasonable and legal.”
He noted that tariff and trade wars have no winner. However, he said that China does not want to fight these wars but is not scared of them. He expressed China’s commitment to joining hands and removing barriers.
China told Washington on Wednesday to “stop threatening and blackmailing” after Trump said it was up to Beijing to come to the negotiating table to discuss ending their trade war.
“If the US really wants to resolve the issue through dialogue and negotiation, it should stop exerting extreme pressure, stop threatening and blackmailing, and talk to China on the basis of equality, respect and mutual benefit,” said Lin.
“If the US really wants to resolve the issue through dialogue and negotiation, it should stop exerting extreme pressure,” said Lin Jian. “China does not want to fight, but it is not afraid to fight.”
Chinese state media insists that the export restrictions protect national security and don’t amount to a full ban. “As long as companies do not engage in activities that harm China’s national sovereignty, the export control measures won’t affect their normal trade,” the China Nonferrous Metals Industry Association said Sunday.
(With inputs from agencies)
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