Encounter "encirclement and suppression" rare earth industry brewing strain Deal

According to foreign media recently reported that the World Trade Organization (WTO) dispute handling Subcommittee on United States and Europe for Chinese rare earth export controls to make a preliminary ruling proceedings , basically agreed plaintiff 's argument that China has in the rare earth export restrictions , export taxes , etc. a violation of the commitments. According to authoritative sources , China Rare Earth Industry Association has begun with the relevant departments to communicate and to discuss countermeasures.

Insiders pointed out that the United States and Europe is behind the lawsuit rare "encirclement and suppression " suppressing China rare earth prices ambitions , China should strengthen the rare earth mining , production, exports and other aspects management, standardize the market order .

Recently there is news that China is brewing including crackdown private mine, the introduction of " rare Management Regulations" , the different varieties of rare earths including a number of New Deal differentiated management to deal with the export -changing. However, insiders pointed out that this combination of punches in order to look good , the government needs to do more to "warm up ."


Quota system to prove safety
China has about 23% of the world 's rare earth reserves , but long-term supply more than 90% of global rare earth production. Previously few years, China has been in the export of rare earth export quota system perform , that is clearly a year of domestic manufacturing enterprises meet the relevant conditions of export volume and distribution companies , in order to protect resources and the environment and realize sustainable development.

For a long time , disorderly exploitation , destruction of the ecological , low-cost exports is China 's rare earth industry ills . But the United States and Europe and other economies do not care about environmental issues , many times to launch an attack . Since 2009, the EU requested the lifting of the rare Chinese export quota system products , countries began to fight for China's rare earth exports for various actions , intended to get cheap rare earths.

If the United States and Europe in the joint prosecution Chinese " undue restrictions on exports of rare earths " in favor of the issue , then China will have to make concessions on the issue of export quotas . Past experience shows that companies competing prices will be difficult to avoid. Once forced to cancel because of the quota system ( without limiting exports ) after the huge interest in front of Chinese rare earth excessive and indiscriminate digging , smuggling and illegal export of other issues, have "cabbage price" rare earth might comeback .

Investment Advisor in the metallurgical industry researcher Weiqi Ning believes that the future of China 's rare earth industry will show a " wolf inside and outside tiger " situation. He said: "The system of forced adjustment pressures rare earth export quota system , the export tariff will be open . This may not only lead to rectify the problem is being revived , smuggling trafficking phenomenon also on the rise, but will aggravate plight of the industry was forced open . "

Insiders also believe that China may be adjusted after the end of the proceedings rather than cancel the rare earth export quota system. By the end of 2011 , the Ministry of Commerce on the rare earth export quota system has been modified , the modified system according to manufacturer's environmental compliance status of quota allocation , in addition to the quota were classified into light rare earth quotas and heavy rare earth quotas.
Previously held a rare meeting, China Rare Earth Industry Association vice president Wang Qin has publicly said that the cancellation of rare earth export quota management , we recommend first began to consider a lighter rare earths .

However, rare earth export restrictions violate WTO rules quite controversial. Some experts believe that , according to the relevant WTO provisions , in order to protect resources and the environment to achieve legitimate policy objectives , Member States may take the necessary restrictive measures, including export restrictions .

Export policy to be adjusted

WTO ruling will make 2014 the news of rare earth export environment changed dramatically. Response time left to the rare earth industry and no market expected so long , it also deepened the rare earth industry Forced accelerate the introduction of governance policies . Brewing industry consolidation as well as a number of legendary New Deal are rare cases does the WTO "warm up" to prepare .

Analysis of the industry , output restriction will lead to excessive and indiscriminate digging , black market , leading to a waste of resources. Priority should be to adjust the export policy, strengthen application of rare earth development and efficient use of rare earth resources , can not be wasted earth .

Previously, some of the rare earth expert bluntly , rare earth export quota system susceptible to corruption , providing benefits "rent-seeking space," even if the heavy rare earth export restrictions the South , you can also use prices , tariffs and other means to regulate the use of export quotas easily seen by other national grabbed "pigtail ."

There are reports that China slashed rare earth export quotas , resulting in a large number of rare earth enterprises due to lack of quotas , eager to have a trading company export quota system purchase targets. The report shows that the end of 2010 rare earth export quota system "market price " has reached 120,000 ~ 170,000 yuan per ton , up more than 200,000 yuan per ton , while the rare earth quotas speculation to some extent pushed up domestic rare earth spreads.

With the United States, Australia and other countries rare earth enterprises resume production , will produce world's rare earth supply pattern changes, but China in the international market dominance still does not change , the next two to three years in other countries rare earth plant put into operation, will represent to the international market supply about 30%.

It is reported that domestic rare earth enterprises in order to cope with the possible arrival of the dilemma , is quietly pushing into force restructuring to form . It is reported that six months after the suspension of Wei Hua shares recently announced Ganzhou Rare Earth backdoor plan. Restructuring plan shows Ganzhou Rare Earth will listed as rare earth industry development and capital market financing platform to further integrate Ganzhou area of rare earth downstream smelting and separation operations , and gradually developed into a mining and dressing , smelting separation and processing as one of the major rare earth industry group company .

And at the national level by no means without countermeasures. May 10, 2011 , the State Council issued " on the promotion of the rare earth industry healthy development of a number of opinions ", the country around the rare earth resource development, smelting separation and circulation market order expand regulation by the Ministry of Industry and the formation of large rare earth industry group programs , now the industry has formed a number of sets resource extraction, smelting separation processing and application technology research and development of rare earth industry in one large group .

August 2012 , by the Baotou Rare Earth , Xiamen Tungsten and other 12 rare earth production and circulation enterprises invested 10 million yuan each common form of rare earth trading platform - Baotou Rare Earth Products Exchange Limited was established . The company was founded signified by the enterprises themselves, the sponsoring organization of rare earth rare earth products to complete the formation of spot trading platform , the platform will host China's first rare earth products electronic disk operations. Insiders expect the trading platform to be able to play a positive role in stabilizing prices of rare earth .

Recent news that China is brewing a number of New Deal response to export change in the situation , including the crackdown private mine, intends to introduce regulations for rare metals , rare earth brewing different varieties of differentiated management policies . If the WTO ruled that China rare earth export restrictions violations, the policy is also expected to launch .

Rare applied research to be strengthened

Insiders said that China will remain in the rare earth industry consolidation, including environmental and industry consolidation , etc., but compared with the country's strict control measures , with many developed countries, China has a rare application of a wide gap . The international community has been engaged in rare earth basic research, compared to the country , foreign basic research in the application of rare earth a long time, their practical application , the production process, we found some of the rare earth uses.

At the same time , how to more rational use of WTO rules also require rare earth industry "catch-up " one of the priorities .

Expert advice related fields , through communication with the WTO , the country may be classified management for LREE , such as light rare earth export management to some extent liberalized, but the heavy rare earth is still the implementation of conservation policies . Also play a role in the production market, mandatory plans ; establish RE purchasing and storage system , in order to mitigate the impact of WTO ruling .

Although WTO rules do not support the number of Member States to restrict exports of high tariffs and setting behavior , but allows member states to manage exports through export qualification . If the earth through the formation of large enterprise groups , can curb the excessive and indiscriminate digging earth , effective management of rare earth exports . Moreover, China 's rare earth industry in line with WTO majority requirement, but did not do the export quota and the number of domestic consumption to maintain consistency , so China under the framework of the WTO may request to retain the rare earth export quota , while the quota extended to domestic consumption consistent with levels.

Perhaps the long term, Chinese rare earth quotas certainly still will continue to suffer criticism. But stabbing outside must first be peace within , if they can be govern domestic rare earth industry in chaos , and then export management perfecting , Chinese rare earth export quota system to complete the transformation, so that no foreign country can handle grip .


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