‘If they don’t give us…’: US warns China of 200% tariff over rare-earth magnets export

He said China intelligently went in and they sort of took a monopoly of the world’s magnets. “Nobody needed magnets until they convinced everybody 20 years ago, ‘let’s all do magnets.’ There were many other ways that the world could have gone. It will probably take us a year to have them… we’re heavily into the world of magnets now,” he added further.

#WATCH | Washington DC | “We are going to have a great relationship with China…They have some cards. We have incredible cards, but I don’t want to play those cards. If I play those cards, that would destroy China. I am not going to play those cards” says US President Donald… pic.twitter.com/PDlNPkkmm2

— ANI (@ANI) August 25, 2025

Rare earth magnets, especially neodymium-iron-boron (NdFeB) magnets, are crucial for EV manufacturing. They provide the strong magnetic fields needed for efficient and powerful electric motors, including traction motors that drive EVs. These magnets also play a major role in other EV components like power steering systems, wiper motors and braking systems. China has a virtual stranglehold over these rare earth magnets.

In April, the Trump administration imposed a 145 per cent tariff on China. In a response, Beijing put 125 per cent tariff on US exports. However in recent months, both the world’s two largest economies decided to slash the tariff — the US levy on most Chinese imports now stands at 30 per cent while China has placed a 10 per cent duty on US imports.

Earlier this month, Trump signed an order to extend a tariff truce with China by 90 days, just hours before higher tariffs were due to take effect.

The tariff truce began in May after talks in Geneva, where both sides agreed to a 90-day pause to allow further negotiations. They met again in Stockholm in late July but did not announce a new deal at the time.