WASHINGTON – President Donald Trump predicted he would reach a "fantastic" trade deal with China at the end of the month, despite the ongoing trade war over tariffs and rare-earth minerals.

"I think we’re going to end up having a fantastic trade deal with China," Trump told reporters at the White House.

His optimism contrasted with a trade war of dueling tariffs and a Chinese threat to withhold rare-earth minerals from the rest of the world. Trump was meeting Oct. 20 with Australia’s Prime Minister Anthony Albanese to announce a deal for processing rare-earth minerals that are crucial for electronics and military equipment, and investing $1 billion in joint projects.

Their announcement came after China announced restrictions Oct. 9 on rare-earth exports. In response, Trump threatened to raise tariffs on Chinese imports to 157% if no trade deal is reached by Nov. 1.

Besides the rare-earth restrictions, Chinese retaliatory tariffs have nearly eliminated that country importing U.S. agricultural products. China is the top importer of U.S. soybeans and farmers are concerned about selling this year’s crop.

"They stopped buying our soybeans because they thought that was punishment," Trump said of China. "It is punishment to our farmers, but we’re not going to allow that to happen."

Despite the trade war, Trump said China has treated the United States with "great respect" and that he expects the two countries to resolve their differences. He is expected to meet with China’s President Xi Jinping during is upcoming trip to Asia, while he is in South Korea on Oct. 31 and Nov. 1.

"I think we’ll make a deal," Trump said. "They threatened us with rare earths and I threatened them with tariffs."

Military issues are also expected to be discussed. But Trump refused to comment on tensions over the Taiwan strait, where mainland China would like to regain control of the island that has declared its independence.

"I’m not going to talk about that now," Trump said.

This article originally appeared on USA TODAY: Trump predicts 'fantastic' trade deal with China to end tariff disputes

Reporting by Bart Jansen, USA TODAY / USA TODAY

USA TODAY Network via Reuters Connect