China sets up rare earth body to shake up industry

BEIJING Sun Apr 8, 2012 8:42am EDT

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BEIJING (Reuters) - China on Sunday set up a rare earth industry association, state media reported, in a move to speed up consolidation of its sprawling industry that has drawn fire for what overseas trade partners call unfair export quotas.

The association, with 155 members across the country, will report to the Ministry of Industry and Information Technology, which regulates rare earth production, the official Xinhua news agency said.

Baotou Steel Rare Earth in Inner Mongolia, Rising Nonferrous in Guangdong and China Minmetals are among 13 heavyweight members, Xinhua said.

Su Bo, an industry vice minister, said Beijing wanted to shake up the industry by phasing out small smelters, giving big players a greater stake in the supply of rare earth metals and boosting environmental protection.

"China will continue to clean up the rare earth industry, expand rare earth environmental controls, strengthen environmental checks, and implement stricter rare earth environmental policies," Su said.

Xinhua said the long-awaited body would promote international exchanges and help Chinese companies to handle trade disputes. China's rare earth export quota is managed by China's Ministry of Commerce.

The European Union, the United States and Japan complained to the World Trade Organization last month that China is illegally choking off exports of rare earths to hold down prices for its domestic manufacturers and pressure international firms to move operations to China.

China accounts for about 97 percent of world output of the 17 rare earth metals crucial for the defense, electronics and renewable-energy industries and used in a range of products such as the iPhone, disk drives and wind turbines.

Beijing has said its export curbs are necessary to control environmental problems caused by rare earth mining and to preserve supplies of an exhaustible natural resource.

(Reporting by Zhou Xin and Michael Martina; Editing by Ron Popeski)

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Comments (4)
Eideard wrote:
Yup. Really unfair to set rationed export quantities to preserve first use over time for your own industries. Would have been more in line with Western crap rationales to use, say, national security requirements to limit availability to furriners.

Apr 08, 2012 9:07am EDT  --  Report as abuse
Jeepgirl wrote:
The U.S.A. has at least 2 rare earth mines. One in Colorado and at least one more in California. A company from Canada is looking at purchasing them and putting them to work.

Why is the U.S.A. not doing this? EPA? Mr. President Obama? Congress?

Apr 08, 2012 12:13pm EDT  --  Report as abuse
mgunn wrote:
Its better to diversify and/or find alternative technologies. But without a national policy to develop such things the ONLY way the market will adjust is by raising prices. This maneuver by them was long overdue; in fact, its amazing they let it go on as long as they did. They pollute and earn pennies while our high-tech companies make the big-bucks and weapons.

Apr 08, 2012 6:41pm EDT  --  Report as abuse
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