Insights 
VT 
Trump announced a development with China on Wednesday, claiming a deal had been signed. Similarly, US Commerce Secretary Lutnick stated a US-China trade deal was confirmed two days prior.
However, it was revealed that this announcement pertained to a deal reached in Geneva in May. A White House official clarified it was an understanding about expediting rare earth shipments to the US, not an entirely new deal.
Further Steps to Implement Geneva Accord
The agreement reached this week outlines further steps to implement the previously stalled Geneva accord. China will expedite the licensing for rare earth mineral exports, while the US will ease some export controls that were imposed due to China’s earlier non-compliance with the Geneva agreement.
The initial reports painted a picture of breakthrough diplomacy, suggesting a fresh agreement had been secured. Trump’s announcement hinted at a new chapter in US-China trade relations, but the reality proved more of a continuation than a transformation. Lutnick’s comments, while affirming the existence of an accord, lacked context—context that became clear after the White House clarification. Rather than a new deal negotiated last-minute, the developments pertain to a supporting measure tied to the Geneva agreement from May.
That prior agreement had been stalled by tensions and alleged non-compliance. In particular, the US had previously tightened export restrictions in response to China dragging its feet on rare earth mineral delivery timelines. Those minerals play a critical role in both civilian and military manufacturing, particularly within electronics, and the lack of progress had raised concerns across industries.
This week’s accord now aims to unblock that delay. It sets out targeted actions: Chinese authorities will speed up approvals required to ship rare earths, and in turn, the US will roll back certain restrictions it imposed earlier this year. Rather than reshaping commercial ties, this is an administrative gear change to revive an older structure that never took off.
Market Impact and Strategic Opportunities
For us watching market derivatives closely, this adds short-term predictability around rare earth supply and export conditions. With known timelines and clear compliance mechanisms back on the table, pricing risk shortens. Traders should factor in lower volatility in input access for firms reliant on rare earths, especially in defence and technology. That kind of clarity suggests a reassessment of original hedges based on disruption risk might be in order.
While the initial reaction might have been to interpret the statements as new material action, what we actually have is a formalisation of implementation steps. We should keep in mind that markets don’t move on repetition—they move on adjusted positions. With less uncertainty hanging over mineral flow, traders can likely pause on momentum strategies linked to supply shocks in that sector.
For positions established earlier in the year under assumptions of extended trade deadlock, a slow unwinding might be warranted if not already underway. The window over the next fortnight could present low-slip opportunities to soften exposure. Any upside originally priced in by interpreting Trump’s remarks as a breakthrough will likely deflate once broader participants digest the clarification.
Given that the Geneva understanding is once again being treated seriously by both sides, and steps are now bookended by measurable shifts from regulators, we might also expect a reduction in premiums linked to rare earth disruptions across industrial options chains. Not across the board, but selectively—especially where companies have previously been penalised by bottlenecks.
It’s worth watching export licensing timelines coming out of China over the coming days. If those are met and matched by US easing actions, the expected borrowing costs tied to future delivery contracts could compress. That would allow for refinements in certain straddle strategies by next month.
So, where one might have braced for fresh risk exposures following high-level headlines, the real focus rests on execution—a different category entirely. This matters not for what was said but for how it’s now being enacted.
