Eliminated the earth "cabbage price" does not have a "monopoly price"

This year August 15 to November 15, the State Ministry of Public Security, Ministry of Land Resources, Ministry of Environmental Protection, General Administration of Customs, State Administration of Taxation, the State Administration of Production Safety Supervision and Administration for Industry and other eight ministries, in nationwide campaign against rare earth mining, production, circulation of illegal special action.

More than 90% of global rare earth resources from China in the past 20 years, China's rare earth industry in international trade not only no pricing power, resources will be sold "cabbage price." While large-scale mining since 1992, rare earth mining in the country is left devastated ecological destruction and serious waste of resources.

This really does not make sense. As long as the world found a large value of mining resources, the place is always able to get a lot of money and wealth, the income of the inhabitants of the land have always been greatly improved. Because of the access to the capital and technology, its environment can also get the appropriate repair and renovation. So there is always a place resources where no resources than more affluent and better.

Chinese rare earth mining get the opposite result, it is now very clear that this is due to years of over-exploitation of rare earth, caused by the illegal exploitation. Over-exploitation of the low prices, resulting in downstream separation of rare earth smelting rapid expansion of production capacity, resulting in excess capacity. Excess capacity, a further blow to the domestic rare earth prices, and the resulting vicious cycle of the entire industry. And this is done by technical conditions on the cost of capital for SMEs operate less demanding hundreds, or even illegal illegal operation results.

China Rare Earth Industry remediation chaos has been for some time, yet the Chinese rare earth resources from a reasonable, objective benign industrial use there is considerable distance. So this time focus on remediation but very necessary.

The main task of special rectification actions include checking the implementation of the local government territorial mandatory production plan, mining quota of total control, environmental verification, production safety, VAT invoices and other rules and regulations to implement and so on. To this end eight ministries established six priorities and requirements.

Generally, this six priorities and requirements are in line with this special rectification action total requirements. However, there are two points which I think is debatable, but these two points on the rare earth industry, China's market economy is not irrelevant.

In order to regulate the rare earth industry, eight ministries and quasi-pinching vital, "focus on verification smelting enterprises mineral source separation, focus on examination of trade enterprises purchase and sale of rare earth minerals." But it is to "guide the rare earth mineral mining enterprises will be sold directly to a smelting separation plan targets enterprise", and even that is actually required of rare earth mineral mining enterprises must be sold to a business plan targets smelting separation, which is sold to those who have a strong background in government-owned enterprises.

Chinese rare earth enterprises currently have mandatory plan, but China's rare earth industry basically should still implement market mechanisms. The "boot" or requirements upstream companies to sell their products to the specified downstream businesses, according to China's "anti-monopoly law," is part of the nature of vertical monopolies. Therefore there is a need to change these require "rare earth mineral mining enterprises must be sold to legal compliance and downstream enterprises."

Remediation China's rare earth industry, no doubt have to raise the rare earth industry, industry concentration. However, such a set, only in a fair and reasonable competition in the market resulting concentration of the rare earth industry in order to improve labor productivity in order to make China's rare earth industry reasonably healthy and sustainable development. Developed by a centralized administrative intervention, mostly the product of the planned economy, resulting in a small number of state-owned monopoly. Linked to the first two years of management to assign a macro northern South twenty-three state-owned monopoly of rare earth industry rumors, this is the need for vigilance. Do the rare earth industry in order to eliminate the confusion, the eradication of rare earth "cabbage price", and the emergence of monopolies and rare earth industry products exorbitant "monopoly price."


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