China and the United States have agreed to cut tariffs imposed on $60 billion worth of goods imported from each other, including U.S. corn, cosmetics, Chinese household appliances, and toys. The two sides reached a deal for China to import at least 10 million metric tons a year of U.S. coal in both 2027 and 2028 (about 2% of China’s coal imports), which it can easily do as it imported more than 12 million tons in 2024. China is the world’s largest coal producer, consumer, and importer, and became a net importer of coal in 2009. China’s coal pledge comes amid disappointing domestic output and uncertainty from its top overseas supplier, Indonesia. Imports from Indonesia have plummeted 25% so far this year as Indonesia seeks stricter management of its natural resource exports. The commitment to buy U.S. coal was the most specific commitment either country announced following the meeting. No agreements were reached regarding U.S. oil or liquefied natural gas.
The two sides also agreed to pursue more favorable tariffs on $30 billion of non-sensitive goods based on 2024 import data, including U.S. coal and agricultural products. The lists cover 77 categories of Chinese goods entering the United States and 1,619 categories of U.S. goods entering China. While the two sides have approved the product lists, future tariff reductions must still go through each country’s domestic legal procedures. According to China’s Commerce Ministry, the two governments would implement the reductions simultaneously after completing those procedures, but no effective date has been announced.
China’s Commerce Ministry said the arrangement would remove additional tariffs on more than 90% of the products covered. Those goods would instead be covered by each country’s standard tariff rate, known as the “most-favored-nation” rate.
The two countries separately extended their existing trade truce by two months, moving its expiration from November 10 to January 10. China’s commerce ministry said a two-month extension of a trade truce would provide room for both sides to evaluate their ongoing arrangement to resolve economic and trade issues, while considering how to advance on those fronts. Both sides will hold regular talks on potential investment opportunities and barriers, enhancing policy transparency and predictability, and responding to enterprises’ concerns. According to Treasury Secretary Bessent, he was unsure whether the two sides could reach a broader agreement, though the Chinese negotiators had proposed a larger deal. He said the United States was open to either continuing the existing arrangement or exploring a broader one.
Both sides have agreed on a communication channel for incidents relating to artificial intelligence and will hold a follow-up dialogue by the end of November. China agreed to examine and approve foreign financial services institutions, including those with U.S. capital, to conduct business and open branches in China.
In 2020, energy and commodities were at the center of the Phase One US-China trade deal, in which China agreed to increase U.S. imports by $200 billion. Actual purchases fell far short of the goal after the COVID pandemic took a toll on China’s economy and strained relations between the two countries. Despite China missing its soybean commitment in 2025, Treasury Secretary Scott Bessent said China met its soybean-purchase commitment for this year but was behind schedule on other U.S. agricultural products.
Regarding critical minerals, the American Action Forum reports on China’s previous commitments: “In terms of China’s promise to restore critical mineral exports, the evidence is mixed. Looking at U.S. imports of a group of rare earths including cerium, scandium, and yttrium, it appears that the value and volume have not been suppressed and have recovered from last year’s dip. At the same time, U.S. imports of gallium, graphite, and a handful of other rare earths remain low, similar to during the trade war. One report confirms this, saying China continues to restrict exports of rare earths and rare earth magnets despite the U.S.-China trade truce. The Shipment’s analysis of Chinese export data also confirms that certain critical mineral exports to the United States have yet to recover.”
Conclusion
China has agreed to import at least 10 million metric tons of U.S. coal in both 2027 and 2028, about 2% of its coal imports, as the U.S. has the largest proven coal reserves. China is the world’s largest coal producer and importer and became a net importer of coal in 2009. Its coal pledge comes amid disappointing domestic production and uncertainty from its top overseas supplier, Indonesia. China’s imports from Indonesia have plummeted 25% so far this year as Indonesia seeks stricter management of its natural resource exports. While China has not always lived up to its agreements, it should be able to easily import 10 million tons of U.S. coal, since it imported over 12 million tons in 2024. No agreements were reached regarding U.S. oil or liquefied natural gas.
