WASHINGTON (BN24) — President Donald Trump on Monday threatened to impose new tariffs on China over its control of magnets, escalating trade tensions even as a 90-day pause on tariff increases remains in place ahead of negotiations between the world’s two largest economies.
Speaking to reporters, Trump warned that Beijing must increase shipments of magnets to the United States or face steep penalties. “We have to charge them 200 percent tariff or something,” he said.
The remarks highlight the growing importance of rare earth elements, especially magnets, which are essential for manufacturing semiconductor chips and other high-tech products. China dominates the global magnet market, accounting for about 90 percent of supply.
In April, Beijing expanded its export restriction list to include several rare earth items and magnets, a move widely seen as retaliation for Washington’s earlier tariff hikes. The restrictions have heightened global concerns over supply chains tied to critical technologies, including smartphones and advanced electronics.
The dispute comes as the U.S. deepens its involvement in the semiconductor industry. Earlier this month, Washington announced it had secured a 10 percent stake in Intel, one of the world’s leading chipmakers reliant on rare earth inputs.
Despite tensions, Chinese exports of rare earth minerals rose sharply in July, with customs data showing imports of rare earth ore increasing by more than 4,700 tons compared to the previous month.
Trump’s latest comments mark a sharp shift after earlier signs of easing tensions. Just weeks ago, he signed an executive order extending a 90-day freeze on tariff increases to allow more time for talks. Without the extension, tariffs on Chinese goods would have surged to 145 percent. In May, both sides agreed to a 30 percent U.S. tariff rate, scaling down from 125 percent to 10 percent as part of temporary measures.
The looming standoff over magnets underscores the fragility of trade relations, with both Washington and Beijing signaling readiness to harden their positions despite ongoing negotiations.
