The full quota for export of rare earth materials has increased by 2.7 per cent. China is responsible for 90 per cent of global rare earth supply.
By Anna Scott | August 2012
For the first time since 2009, China has increased its quota for exporting rare earth elements, the Republic’s Ministry of Commerce (MOC) has announced.
The full quota for export of the material, which is used in the manufacture of a diverse range of high-tech products, including mobile phones, iPods and wind turbines, has increased by 2.7 per cent since last year, taking 2012’s total to 30,996 tonnes.
This includes 8,537 tonnes of light rare earth materials, and 1,233 tonnes of medium and heavy rare earth materials.
The country introduced an export quota of 30,000 tonnes a year in 2009 after dominating the market for rare earth production for two decades. China is now responsible for more than 90 per cent of global rare earth supply.
The mining of rare earth metals has caused severe environmental damage in several
parts of China.
According to a statement from the MOC: “To reduce the environmental damage caused by rare earth exploitation, China has suspended the issuance of new licenses for rare earth prospecting and mining, imposed production caps and export quotas, and announced tougher environmental standards.”
However, the country has come under criticism for restricting the export of rare earths. Earlier this year, the World Trade Organisation accepted the EU, US and Japan’s complaint that the export quota has increased prices of rare earths.
A report published by the Institute for Defence Studies and Analyses in August suggests that since China’s intensive regulation of the rare earth industry began in 2010, the country has started to build strategic reserves.
The report, China Consolidates the Rare Earth Industry and Builds Strategic Reserves, states: “Its policy measures have heightened the consolidation process of the industry and the country has started to build strategic reserve of the minerals. These policies will provide China more power to fix the prices and control the supply in the international market.”
“China’s pre-eminent success in the rare earth industry is the result of both careful thought and consideration at the highest policy making levels, which have constantly expedited reform in the industry,” writes the report’s author, Nabeel A. Mancheri.
“These policies are well-thought decisions that are directly linked to its long-term objectives to become an innovative nation by 2020 and a global scientific power by 2050.”
☛ The autumn 2012 issue of CPO Agenda will include an analysis of the rare earths sector.