Rare earth export permits for US customers are likely to have an easier time getting approval from Beijing after Monday's trade war truce, however a complete removal of the restrictions is unlikely, according to two sources in the industry in China.

China added seven rare earths and related items to a control list in April as part of its retaliation against US tariffs. The decision means exporters need to apply for licenses before selling outside China.

While the decision applied to all countries, the likelihood of US customers receiving export licenses during the trade war looked unlikely. Elon Musk said last month Tesla was in talks with Beijing over licenses for its Optimus robots.

The truce announced on Monday could see the Ministry of Commerce expedite approvals, which in theory take 45 days, and even grant licenses for US customers soon, according to two sources in the industry who were granted anonymity given the sensitivity of rare earths in China.

"We are expecting to see an acceleration in the issuance of the required export license and exporters with clients in the US might get a license soon," said one of the sources.

However, China is unlikely to remove the export controls because they form part of a broader package of measures designed to give Beijing greater control over various critical minerals where it dominates the mining or processing, they added.

China, the world's largest supplier of dozens of strategic minerals, began imposing restrictions in 2023 on exports of several minerals vital to sectors ranging from chipmaking and energy transition to defence.

The United States, which imports most of its rare earths from China, faces the threat of being cut off the critical minerals vital to defence and other high-tech sectors.