China's rare earth industry consolidation reshuffle development outlets

Although China has a monopoly over 95% of global rare earth supply, but the actual world and its reserves of only 36%. Past monopoly is due to low-cost and excluding environmental costs caused by the development. China's rare earth industry consolidation reshuffle the way out.

Beginning in 2007, China tried to control exports of rare earths, and controls more stringent. Such a move gave the United States and Japan, a major buyer of these rare earth greatly annoyed, even gave China buckle of the "resource nationalism" hat. There are signs, however, in a few years time, this situation has changed. United States and Japan decided not to sit still and began jointly seek alternative sources of rare earths China.

The Pentagon and the Japanese Toyota is preparing with Canada's two mining companies ---- Ucore Rare Metals Co., Ltd. and Matamec exploration companies to develop rare earth mine in North America. Just earlier this month, Japanese Foreign Minister Genba a continuous meeting with Kazakhstan and other foreign ministers of the five Central Asian countries, promised to give financial support to those countries by way of joint venture plant to develop these former Soviet Union country of rich rare earth mineral resources .

In fact, in China outside of the current total of 244 companies from 36 countries are developing 381 rare items. The report predicts that by 2020 there will be 15% -20% of rare earth production shift out of China. This is actually not surprising ---- China although a monopoly over 95% of global rare earth supply, but the actual world and its reserves of only 36%. Past monopoly is due to low-cost and excluding environmental costs caused by the development. However, in recent years, China's control of rare earth export quota of rare earth prices have already risen to be sufficient to attract interest in other countries and contributed to the development of the degree of competition.

Data supporting this. 2011 physical volume of China's rare earth export quota is 30,000 tons, while the actual physical volume of exports only 18,600 tons, 40% of rare earth quotas are not used. This should cause the Chinese Rare alert investors of listed companies. However, the loss of rare earth export monopoly for China is not all bad news. China can take the opportunity to complete the rare earth industry reshuffle and integration, to this industry to grow stronger, in order to meet China's domestic demand generated by the rise of high-tech industries.


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