Nomi Prins — Trump-Xi Summit: China's Rare Earth Leverage is Growing
After two days of warm words in Beijing, China's rare-earth grip is stronger — not weaker — than it was six months ago.
One-line take: the May 15 Trump-Xi Beijing summit produced no major rare-earth deal — China's April-2025 export licenses on dysprosium, terbium and five other heavy rare earths were never suspended, and exports remain ~50% below pre-restriction levels. China controls ~99% of heavy-rare-earth processing and supplies 71% of U.S. rare-earth imports; the Iran war raised the stakes (the same magnets go into missiles, drones and jets). The suspended October-2025 controls expire Nov 10, 2026, resetting the leverage clock. Prins's takeaway: the West is funding ex-China supply (DoD took a stake in MP Materials; Commerce put $1.6B into USA Rare Earth), but rebuilding processing takes years — so exports won't normalize before November.
1. Stocks & names mentioned
A geopolitics-driven rare-earth thesis; the named companies are cited as examples of U.S. government capital building ex-China supply, not as buy/sell ratings (Prins's actual picks here are paywalled). "View" reflects how each was framed. The "At" link opens the article. Research: QT Qualtrim · SA Seeking Alpha · STK Stock Analysis.
| Ticker | Name | Research | View | What she said | At |
|---|
| MP | MP Materials | QT · SA · STK · FA | Positive | The U.S. Department of Defense took a stake in it — cited as the lead example of Washington putting capital into a domestic rare-earth supply chain to break China's grip. | read |
| USAR | USA Rare Earth | QT · SA · STK · FA | Positive | The Department of Commerce invested $1.6B in it — a second federal bet on building U.S. rare-earth capacity outside China. | read |
| Serra Verde | Serra Verde (Brazil) | — | Neutral | The Brazilian rare-earth producer the U.S. International Development Finance Corporation financed — an example of Washington seeding ex-China supply abroad (private). | read |
| Rare earths (NdPr / Dy) | Rare earths | — | Positive | The metal at the center of the leverage: China runs ~99% of heavy-rare-earth processing; dysprosium oxide traded $189/kg domestically in China vs $317 FOB for Western buyers (a 67% premium) — controls are clearly working, and exports stay ~50% below pre-restriction levels. | read |
"View" reflects how each name was framed (Positive = a beneficiary of the ex-China rebuild / bullish on the metal; Neutral = a supply-chain data point), not a price rating. Built from the article's free/public portion; Prins's specific recommendations (a Pulse Premium rare-earth name and an April Founders+ processor) are paywalled. Research: QT Qualtrim · SA Seeking Alpha · STK Stock Analysis.
2. Key points
The summit settled nothing on rare earths
- Trump and Xi met in Beijing May 15 with rare earths explicitly on the agenda. Trump said "a lot of different problems were settled," but no major agreements were announced. The April-2025 license regime on dysprosium, terbium and five other heavy rare earths was never suspended — exports remain ~50% below pre-restriction levels more than a year on.
- Six months earlier in South Korea, Trump claimed rare earths were "settled"; in fact China only agreed to delay a new set of October-2025 controls — the existing April-2025 controls were never part of the deal.
The Iran war raised the stakes
- Heavy rare earths like dysprosium go into the permanent magnets used in missile guidance, drone motors and high-temperature aerospace/defense systems — the same materials in jets, naval vessels and drones used in the Gulf conflict. The U.S. is entirely import-reliant for heavies, with 71% of all rare-earth imports coming directly from China, which controls ~99% of heavy processing.
The expiring clock and the price tell
- The suspended October-2025 controls (extraterritorial, modeled on the U.S. Foreign Direct Product Rule, licensing anything with ≥0.1% Chinese-origin rare earths) expire Nov 10, 2026 — the leverage clock simply reset for another six months.
- The controls are working: pre-April-2025, Chinese domestic and FOB dysprosium prices moved together; by March 2026 China domestic dysprosium oxide was $189/kg while Western buyers paid $317 FOB — a 67% premium.
The West is building, China is tightening
- U.S. capital is flowing into ex-China supply: DoD took a stake in MP Materials; Commerce put $1.6B into USA Rare Earth; the DFC financed Serra Verde (Brazil) and committed capital in South Africa; Australia, Canada and Japan have all made commitments. But building a resilient chain takes years.
- Meanwhile China reinforced its grip — March-2026 laws make it harder for foreigners to invest in or access its rare-earth sector, and April penalties target unauthorized mining/processing/separation. Prins's call: exports won't normalize before November, because China still dominates the processing infrastructure the rest of the world is trying to rebuild.
3. In plain English
A jargon-free summary of why each name is in the piece. (Plain-language companion to the table above; renders on each ticker's consolidated page.)
MP — MP Materials Positive
Rare earths are the special metals that make the powerful magnets inside electric motors, missiles and drones — and China controls almost the entire supply chain, especially the processing step that turns ore into usable magnet material. MP Materials runs the main U.S. rare-earth operation, and the Pentagon has taken an ownership stake in it. Prins points to that as proof Washington is now willing to put taxpayer money directly into building a domestic alternative to China — a structural tailwind for the company, even though she isn't issuing a formal buy here.
USAR — USA Rare Earth Positive
USA Rare Earth is a second U.S. player trying to build rare-earth and magnet capacity at home. The Commerce Department invested $1.6 billion in it. Prins uses it alongside MP Materials to make one point: the U.S. government is funding more than one company to break China's near-monopoly, so the whole ex-China rare-earth group has policy money behind it — but standing up new processing takes years, which is exactly why China's leverage stays strong in the meantime.
Summary derived from the public (free) portion of the Prinsights Substack article for personal study. Not investment advice; the author's specific recommendation is paywalled. © Nomi Prins / Prinsights for source material.