President Trump expects to lower fentanyl-related tariffs on China, discusses ‘farmers’

US President Donald Trump says he expects Beijing to lower fentanyl-related tariffs on China after the government confirmed a high-stakes meeting between President Xi Jinping and US leaders.

A Chinese Foreign Ministry spokesperson said Wednesday that President Xi will meet with President Trump in Busan, South Korea, on Thursday to exchange views on issues of common concern, but did not provide details.

“We will work with the United States to promote talks to achieve a positive outcome,” the spokesperson said in Chinese, translated by CNBC.

Earlier Wednesday, President Trump told reporters aboard Air Force One that fentanyl entering the United States and “farmers” would be among the topics he planned to discuss with President Xi on Thursday.

Asked if a one-year suspension of China’s rare earth export restrictions would be enough to wring further concessions from the United States, Trump said: “We haven’t talked about the timing yet, but we’re going to work something out.”

The meeting between the two leaders, the first face-to-face sit-down since Trump returned to office in January, comes amid heightened tensions between the two countries in recent weeks. The Chinese government has tightened export controls on rare earths, while the U.S. government has retaliated by imposing port fees on Chinese ships and threatening software-related export controls.

The delicate easing of trade tensions between the world’s two largest economies, which includes lower tariffs on each other’s goods, is set to expire on November 10th unless they can agree to extend it again. President Trump also threatened to impose 100% tariffs on China starting November 1st.

The Wall Street Journal reported Tuesday that the United States could cut in half its 20% fentanyl-related tariffs on Chinese exports in exchange for Beijing cracking down on exports of the chemicals used to make fentanyl. If the U.S. government were to lower these tariffs to 10%, the average tariff on most Chinese imports would be about 45%, compared to about 55% currently.

Regarding whether Taiwan will be on the agenda, President Trump said, “I don’t even know if I’m going to talk about Taiwan. I might want to ask about Taiwan. I don’t really hear about that.”

In response to a question about exports of Nvidia’s Blackwell chips to China, President Trump said, “I think we’ll talk to President Xi about that.”

President Trump said in a speech at the Asia-Pacific Economic Cooperation (APEC) summit on Wednesday that he hoped to reach a deal with Xi that would be a “good deal for both sides.” The United States also expects to finalize a trade deal with South Korea “soon,” he added.

A ministry spokesperson announced last Friday that Chinese President Xi Jinping would also address the summit and hold bilateral talks with foreign leaders.

The US president began a whirlwind tour of Asia on Sunday, signing a flurry of trade and mineral deals with Southeast Asian leaders and, most recently, with Japan.

Neo Wang, China strategist at Evercore ISI, said possible outcomes of the Trump-Xi meeting include guarantees that Beijing will secure access to U.S. rare earth items under export control measures, the purchase of a Boeing plane, approval of TikTok’s sale of its U.S. operations, and further efforts to curb fentanyl leaks.

In return, the U.S. may offer to cut fentanyl-related duties by 10 percentage points starting Nov. 10 as part of a re-tariff truce, ease export restrictions on certain semiconductor equipment and AI chips, and remove the threat of 100% tariffs, Wang said.

“We hope that the Chinese government will facilitate President Trump’s reductions in fentanyl tariffs on China and provide President Trump with a solution to the fentanyl impasse that will take effect no later than November 10, including through new direct commitments with President Xi,” Wang added.