Trump will set price floors across industries to combat China, Bessent says
The Trump administration will set price floors across several sectors to combat China’s market manipulation, Treasury Secretary Scott Bessent said in an exclusive interview with CNBC on Wednesday.
China has driven foreign rivals in the rare earth industry into bankruptcy over the past two decades, using its global dominance in refining and processing to drive down prices, Bessent said.
“When you’re facing a non-market economy like China, you have to do industrial policy,” Bessent told Sara Eisen at CNBC’s “Investing in America Forum” in Washington, D.C.
“So we’ll be setting price floors and forward purchases to make sure this doesn’t happen again, and we’ll do that across a range of sectors,” the Treasury Secretary said.
Rare earths are used to produce magnets, which are important inputs in US weapons systems such as the F-35 fighter jet and Tomahawk cruise missiles. Rare earth magnets are also required for civilian commercial applications such as electric vehicles.
The Trump administration is working to revive the domestic rare earth supply chain. The Department of Defense struck an unprecedented deal with MP Materials, the largest U.S. rare earth miner, in July, which included a stock, floor price and purchase agreement.
Last week, China announced new restrictions on rare earth exports ahead of an expected meeting between President Xi Jinping and President Donald Trump in South Korea later this month. In response, Trump threatened to slap China with an additional 100% tariffs.
Bessent told CNBC that the United States could buy stocks in other companies following Beijing’s rare earth restrictions.
“I wouldn’t be surprised,” the Treasury Secretary said when asked about additional stock allocations. “When we get China’s announcement about rare earths this week, you realize we have to be self-sufficient or we have to be sufficient to our allies.”
However, Bessent said the Trump administration will not take shares in non-strategic sectors.
