The rare minerals battle behind Rubio's ban on Chinese students

Axios

2 days ago

When Secretary of State Marco Rubio abruptly announced plans Wednesday to cancel the visas of all Chinese students in the U.S., the Trump administration was quick to cast it as a way to root out spies from the communist nation.
But behind the scenes, what really set off Rubio was the administration's realization that China was withholding precious rare-earth minerals and magnets as a tariff negotiating tool, sources tell Axios.
Why it matters: The decision to target as many as 280,000 Chinese students — and throw another complication into the ongoing trade talks with China — reflects how crucial rare minerals are to the U.S. tech industry.
It also signaled how angry President Trump was after deciding China was operating in bad faith.
Zoom in: That's what inspired Trump's Truth Social post on Friday: "China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US."
"So much for being Mr. NICE GUY!"
Zoom in: The materials at issue are crucial for computing and telecom equipment, F-35 fighter jets, drones, submarines and the Joint Direct Attack Munition series of smart bombs.
The seven minerals include samarium, gadolinium, terbium, dysprosium, lutetium, scandium, and yttrium-related items.
Zoom out: Under President Xi Jinping 's "Made in China 2025" initiative launched a decade ago, China has come to dominate the mining and processing of these minerals and other precious materials, such as lithium used in batteries.
The U.S. is the world's second-largest producer of rare-earth minerals but is dwarfed by China, which controls about 70% of mining and roughly 90% of the processing of such minerals globally, according to a Reuters report citing International Energy Agency estimates.
The big picture: Many of China's ruling party elite, including Xi, have sent their children to study in the United States. Targeting those students sends a message to leaders of the Chinese Communist Party.
Rubio has long been a China hawk. As a senator in 2024, he issued a report, "The World China Made," that warned it could soon have "effective control over strategic supply chains" of the materials.
He also sounded an alarm about China spying through U.S. educational opportunities.
"If you're a Chinese spy trying to get into America, you don't really have to cross the border," he told Fox News' Maria Bartiromo in June 2024. "You can just become a graduate student at one of our universities or become a visa employee at one of our tech companies."
As secretary of state, Rubio has launched several initiatives to monitor and revoke the visas of foreign students.
What they're saying: Education groups criticized Rubio's move. Asian Americans Advancing Justice said that "national security should undeniably be a top priority — but resorting to fearmongering, racial profiling, and xenophobia is never the answer."
Trump's administration unapologetically sees Chinese students as leverage.
"This is about national security, trade, our economy," a senior administration official said. "Everything is a negotiation."
The timeline: Trump launched his latest trade and tariff war on April 2, calling it "Liberation Day. Two days later, China required that companies receive export licenses for the seven minerals. The licenses restrict the flow of the minerals out of the country.
On May 11, the U.S. and China announced a preliminary trade deal. The two sides paused their retaliatory tariffs. Treasury Secretary Scott Bessent and Trade Representative Jamieson Greer negotiated for the U.S.
On May 12, when asked by Fox News' Laura Ingraham whether rare-earth export restrictions had been lifted, Greer said: "Yep. The Chinese have agreed to remove those countermeasures."
But on May 20, CNN confirmed reporting from other publications that China wasn't "getting rid of its controls over rare earths," despite the trade truce.
The reports confirmed what administration officials had encountered in private talks with China: It was playing rare-earth hardball.
"China cheats. It's what they do," Trump said, according to a White House official briefed on the president's comments in a subsequent meeting with his trade team.
"The president wasn't happy," the official said. "He was looking for ideas, and Rubio had this idea of Chinese students."
In a statement to Axios, White House Press Secretary Karoline Leavitt said Rubio "made this decision in the administration's ongoing effort to protect our homeland from espionage and other hostile actions."
Just before 7 p.m. Wednesday, Rubio announced on X that the "U.S. will begin revoking visas of Chinese students, including those with connections to the Chinese Communist Party or studying in critical fields."
About that time, Commerce Secretary Howard Lutnick informed several U.S. companies they needed to limit or stop exporting certain types of software, semiconductor chemicals, machine tools, aviation equipment, butane and ethane, according to Reuters.
On Thursday, Bessent acknowledged on Fox News that trade negotiations "are a bit stalled."
On Friday, Trump followed up with his statement blasting China.
Hours later Deputy White House Chief of Staff Stephen Miller was on CNN, linking Rubio's announcement to the China trade talks.