Trump, China’s Xi Are Due to Meet—but Will They? Why It Matters for Rare-Earth Stocks.

A rare-earth magnet is inspected at MP Materials’ Independence facility in Fort Worth, Texas. (Courtesy MP Materials)

Key Points

• President Trump is expected to meet Chinese President Xi Jinping at the APEC summit to discuss trade amid tariff threats.
• The U.S. government is investing in rare- earth producers like MP Materials to reduce reliance on China for critical minerals.
• Rare-earth and critical-minerals producers’ shares have surged, with MP Materials gaining 375% year to date despite recent drops.

Rare-earth stocks continue to be at the top of investors’ minds as the market weighs potential outcomes of a meeting between the leaders of the world’s two largest economies, an encounter that President Donald Trump warned may not happen.

Trump is expected to meet Chinese President Xi Jinping on the sidelines of the APEC summit in South Korea later this month to discuss trade. It comes as Trump has threatened to put an additional 100% tariffs on China from Nov. 1 in a tit-for tat after Beijing said it would tighten exports of rare earths. That is a supply chain it currently dominates.

“I have a great relationship with President Xi, I expect to be able to make a good deal with him,” Trump told reporters at a press conference at the White House Tuesday, though he also said that “maybe it won’t happen.”

“Things can happen where for instance, maybe someone will say ‘I don’t want to meet, it’s too nasty.’ But it’s really not nasty, it’s just business.”

Shares of rare-earth and critical minerals producers have surged over the past week amid increasing U.S.-China tensions as well as speculation over how the U.S. government’s industrial policy might benefit companies as it tries to reduce its reliance on China.

On Monday, Trump and Australian Prime Minister Anthony Albanese signed a critical-minerals agreement designed to unlock more capital for the sector, including an $8.5 billion project pipeline.

The U.S. Defense Department has also said it’s investing directly in MP Materials , the largest producer of rare earths in the Western Hemisphere, to secure future supply of the minerals which are broadly used in a range of high-tech products.

MP Materials boasts a 375% gain so far this year, but shares have fallen 25% over the past five sessions. The stock fell another 1.6% in early trading Wednesday.

USA Rare Earth and Ramaco Resources have also benefited from recent developments. Shares of both were down around 2% each in morning trading, following large year-to-date gains.

The most direct way for investors to get exposure to rare earths is through equities, analysts at Goldman Sachs said late Tuesday. “Examples of such exposure include equities of ex-China rare earth miners and refiners, or thematic equity baskets,” the analysts, led by Daan Struyven, wrote.

Write to Elsa Ohlen at elsa.ohlen@barrons.com