China's November Exports and the US Tariff Truce: Short-Term Cyclical Rebound Opportunities in Export-Dependent Sectors

The U.S.-China trade truce reached in late October 2025 has injected a wave of optimism into global markets, with China's November 2025 export data reflecting a tentative rebound. According to Reuters, , reversing a contraction in October and signaling a short-term cyclical improvement. This recovery, however, is underpinned by a tactical de-escalation rather than a resolution of structural trade tensions. For investors, the truce creates immediate opportunities in export-dependent sectors, particularly agriculture and rare earths, while long-term risks persist due to unresolved geopolitical and supply chain challenges.

The Truce: A Tactical De-escalation with Sector-Specific Relief

The October 2025 agreement, negotiated between U.S. President and Chinese President , involved reciprocal tariff reductions and suspensions of retaliatory measures. According to the agreement, key terms include: 1. : The U.S. reduced the "fentanyl" , while China suspended retaliatory tariffs on U.S. agricultural products like soybeans, wheat, and corn. 2. : China agreed to issue general export licenses for rare earths and critical minerals, removing export controls imposed earlier in 2025. 3. : Both nations paused port fees on vessels from the other country for one year. According to CNBC, this measure was part of the broader de-escalation strategy.

While these measures provide temporary relief, the U.S. on Chinese goods, . The truce is best viewed as a tactical pause, with structural issues-such as China's dominance in rare-earth supply chains and U.S. legal uncertainties under the International Emergency Economic Powers Act (IEEPA)-remaining unresolved. According to ClearBorder, the agreement has not resolved fundamental trade imbalances.

Sector-Specific Opportunities: Agriculture and Rare Earths

The truce's most immediate impact is evident in agricultural exports and rare earths, both of which are poised for short-term gains. - Agriculture: China's suspension of retaliatory tariffs on U.S. soybeans and grains has already spurred increased Chinese purchases, as noted by J.P. Morgan Global Research. This aligns with Beijing's efforts to stabilize domestic food prices amid weak domestic demand. For U.S. agribusinesses, the truce offers a reprieve from retaliatory duties that had previously eroded profit margins. - : The removal of China's export controls on rare earths-a critical input for green technologies and electronics-has eased supply constraints for U.S. manufacturers. According to ClearBorder, this is particularly relevant for sectors like electric vehicles (EVs) and renewable energy, where China's dominance in the supply chain has long been a vulnerability.

However, the truce's benefits are not universal. Technology and manufacturing sectors remain exposed to high tariffs, with the U.S. maintaining a 50% levy on Chinese goods. This limits the scope for broader export-driven recovery in these areas.

Cyclical Rebound vs. Structural Weaknesses

China's November 2025 export rebound is also supported by a surge in new export orders, as indicated by the RatingDog China General Manufacturing PMI, . This suggests that global demand for Chinese goods-particularly in the sectors benefiting from the truce-remains resilient.

Yet, domestic demand in China remains weak, with the official manufacturing PMI contracting . This duality-strong export orders but weak internal consumption-highlights the fragility of the rebound. For investors, the focus should remain on short-term cyclical opportunities rather than long-term structural bets.

Investment Implications and Risks

The U.S.-China truce creates a narrow window for capitalizing on export-dependent sectors. Agriculture and rare earths are the most direct beneficiaries, with U.S. agribusinesses and Chinese mineral producers likely to see near-term gains. However, investors must remain cautious: 1. Geopolitical Risks: The truce is temporary, and renewed tensions could reignite tariffs, particularly if U.S. elections or China's domestic policies shift. 2. Supply Chain Vulnerabilities: While rare earths are now more accessible, long-term diversification of supply chains remains limited. 3. Domestic Demand Constraints: China's weak internal market could limit the sustainability of export-driven growth.

In conclusion, the November 2025 export rebound and the U.S.-China tariff truce present a tactical opportunity for investors to target sectors like agriculture and rare earths. However, the absence of a structural resolution means that these gains are likely to be short-lived. A balanced approach-leveraging immediate tailwinds while hedging against geopolitical risks-is essential for navigating this volatile landscape.