If the rare earth export tariffs were canceled, smuggling of rare earth profits will be significantly reduced and bear greater risk, then the enterprise will naturally turn to informal channels, smuggling of rare earth or will disappear.

January 21, at a regular press conference held at the Ministry of Commerce, Ministry of Commerce spokesman Shen Danyang, announced that, in accordance with changes in domestic and international market development, and approval of the State Council, the Ministry of Commerce decided to January 1, 2015 start Cancel rare earth export quotas and export tariffs retain until May 2, 2015. In other words, beginning May 2 of this year, China will abolish tariffs on exports of rare earths.

While the industry has long predicted will cancel tariffs on exports of rare earths, but I did not expect such a fast pace. For the cancellation of export tariffs and export quotas of rare earth will soon be canceled, said Shen Danyang, which is to co-ordinate domestic and foreign markets, a specific trade policy options and resources, and is in line with the reform of resource products management system for a domestic rare earth measures, while also considering a policy adjustment related WTO rulings execution carried out.

Elimination of export duties or suppress smuggling

Rare earth export tariffs or canceled on May 2 this year the news came out, the secondary market for rare earth permanent magnet plates listed company's share price has reacted, sweeping away the haze a few days ago.

For rare earth export restrictions regime or to cancel, some analysts believe that this means that the full realization of the export of rare earth market management. The future management of the rare earth industry will be fully implemented in the domestic administration, however, leaving the country's rare earth industry regulation time only six months, hitting, resource tax reform, improve environmental protection and the effective purchasing and storage will become the next focus.

Since 2011, China's rare earth industry has experienced four years of adjustment, the bottom of the cycle itself has already reversed basis, the current price has dropped to the bottom of the industry recognized and less inventory has not become decisive suppress prices factors, in addition to the rare earth continued hitting some areas, the effect is significant. The analysts believe that China loses WTO fully liberalized under the forced exit can be considered a landmark event in China's rare earth industry, will accelerate the promotion of products such as rare earth resources management reform, or for high-level government renewed attention to the rare earth industry opportunity will improve the strategic position of the rare earth industry in the country.

Prior to review, because the existence of export quotas, many companies difficult to obtain export quotas, smuggling has become their means. Although many ministries have jointly controlled, but did not eradicate this phenomenon. Data show that, when in 2001, overseas Chinese rare earth export import statistics are statistics of 1.2 times, which means that the amount of rare earths smuggling has accounted for 120% of normal exports. So Insiders expect, if at all export quotas and export duties cancellation, will curb smuggling of rare earth on a certain extent.

In this regard, the Executive President of China WTO Research Institute of Foreign Trade University, Tu Xinquan think, after export quotas of rare earth is expected to significantly reduce smuggling. "After all, as long as the buyer, have a contract you can get the rare earth export license, we can engage in the export of rare earth."

Analysts more bluntly, the current Chinese export tariffs will light rare earth products to 15%, the heavy rare earth export tariffs to 25 percent in export quotas, export duties have not yet cancellation, smuggling of rare earth is still profitable. If the rare earth export tariffs have been canceled, the profit will be significantly reduced smuggling of rare earth and must bear a greater risk, then the enterprise will naturally turn to informal channels, smuggling of rare earth or will disappear.

Resource tax will be adjusted after the abolition of tariffs

It is worth noting that since the export quota has been canceled, canceled export duties soon, if China's rare earth resources incur a huge loss of it?

For the above speculation, the industry generally believe that if the export tariffs canceled, then the rare earth resources tax is bound to be adjusted. Since April 2011 China began to implement a new rare earth resources tax levied by ore, ore resource tax north of 60 yuan / ton, the South ore resource tax is 30 yuan / ton, after collection of standards for 0.5 yuan / ton - 3 yuan / ton. Market sources said rare earth resources tax levied by the way "from the amount of taxable" to "ad valorem." Northern light rare earth resources in accordance with the 22% tax rate will be levied, South ion mine will follow 35% taxable. Insiders pointed out that, according to the 22% tax rate to 35% of taxable resources tax, coincided with the rare earth export duties levied amplitude coincide "countries are likely to cancel the impact of countervailing duties by the resource tax reform." Many analysts had the case told reporters.

Industry analysts had a case, said: "From the national strategic sense, on the one hand, the state does not want to rare earth prices drop too low, on the other hand, the state always wanted to control pricing of rare earth, rare earth to keep possession in China. "

"But, by the resource tax adjustment only in one direction instead of the current export duties, as the fundamental goal of limiting exports of rare earths, it must protect the environment, conserve resources, since it is necessary to protect the control of production, rather than the control of trade, is a small mining fundamental. "stakeholders have rare Earth Society, told reporters.

However, although the rare earth resources tax instead of export duties may be the general direction, but in the rare earth mining areas is still difficult to completely control the tax. Thus, the domestic resource tax to replace tariffs will be a gradual process. In China Rare Earth Industry Association Deputy Secretary-General Chen Zhanheng opinion, in the short term, the price of rare earth after liberalization policy and will not be much affected, because the export price itself is determined by supply and demand.

"Theoretically speaking, in order to raise prices, the shift to a resource tax tariff which is possible, but the reality is concerned, due to the illegal exploitation of a very serious, China needs to further strengthen the development of rare earth resources and orderly management. To stabilize rare earth prices, specification management of rare earth mining, the key lies in a variety of relevant laws, including environmental laws, whether the strict implementation of the Mineral Resources. "Chen Zhanheng had said.


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January 21, 2015, according to the British metal mesh is understood that several traders trying to smuggle rare arrested from Guangzhou to Hong Kong Customs, market participants confirmed to be true.

This event also shows the firm determination of the Chinese after the elimination of quotas to regulate the market order, crack down on smuggling of rare earth.

A trader in Hong Kong, said three traders attempting to evade customs duties on Monday, Hong Kong was arrested for smuggling rare. Currently 15-25% of the tariff is still rare.

A Singapore trader said he learned two traders were arrested. One attempt to transport 10 containers of lanthanum oxide to enter Hong Kong, and another attempt to smuggle lanthanum cerium alloy, was also arrested.

It is understood that the two traders suspected of smuggling 200 tons and 40 tons of lanthanum oxide, lanthanum cerium alloys. Market participants from China, also confirmed to be true, China began to vigorously combat illegal rare earths.

Singapore trader explains rare now entering our very strict control, cargo clearance times longer than before. This situation will continue until the Chinese New Year. In addition, as China's rare earth producers will gradually discontinued before the Spring Festival holiday, rare earth prices overseas or will be picked up.

A trader in Hong Kong, said he did not understand why these traders do not apply for an export license. He also said that now the cost of entry into Hong Kong's rare to be a lot more expensive, mainly due to the smuggled goods brought some port charges.

Nevertheless, due to export tariffs and other controls, there are still many illegal rare earth in large numbers in the market. Chinese government realized the strategic resource protection hazards and illegal rare earth, rare earth began to increase efforts to crack down on black.

Hong Kong and Vietnam are the emergence of a large number of illegal rare earth materials market. Some Vietnamese illegal exploitation of rare earth ore is transported to China for processing into illegal rare earth, and then go back from the border smuggling.

In October last year, Hong Kong Customs has appeared once a thorough investigation, that is to check smuggling and counterfeit jewelry, when operating hours are longer, the transport of rare earths also caused delays.

RE prices in Europe has not yet affected. Cerium and other light rare earth stocks Rotterdam still more, but relatively few other heavy rare earth such as terbium and dysprosium inventory. Recently China's prices are still higher, dysprosium, gadolinium and neodymium prices to rise to varying degrees.


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RE prices stabilize prices, NdFeB short-chain is expected to recover. Recent national intensive regulation of rare earth, light rare earth prices have gradually stabilized, heavy rare earth prices rose slightly. Steadily rising prices of raw materials in favor of the middle reaches of the industrial chain profitability improvement, otherwise it will generate financial costs. Due to the strong ability to shift the cost of NdFeB enterprises, cost-plus pricing can be cut more profit from bigger cake. From a historical analysis of the share price performance during the rare-earth prices, NdFeB company stock usually follow rose.

Q3 2014 four major listed companies to pick up gradually stabilized, we judge with the rare-earth prices and recovery in downstream demand, is expected to reflect the performance of the inflection point in 2015.

With air conditioning, as the representative of the energy saving industry demand has picked up, or will become the mid-than-expected factors. NdFeB fell sharply after experiencing now relatively ferrites have a comparative advantage once again, the air conditioning industry has a price basis reuse NdFeB; In addition, as in 2013 the new inverter air conditioner energy efficiency standards, the inverter air conditioner compressor neodymium iron boron has become a necessary condition, demand basis NdFeB reproduce, 2015 inverter air conditioner compressor will greatly boost recycling NdFeB incremental demand, or will lead to super-anticipated demand.

New energy vehicles, high-speed growth, boost NdFeB industry long-term prosperity. The main application of high-performance NdFeB downstream VCM market has become saturated, the future long-term space-core power from the automotive market. Especially the new energy vehicles are immense boost demand for neodymium, in 2020 the global demand for new energy vehicles will NdFeB It is estimated more than 50,000 tons, with an average annual growth rate is expected to exceed 60%, the new energy automotive industry will generate disruptive influence. Besides the demand for high-end NdFeB material Industry 4.0 will usher in an era of explosive growth. NdFeB industry or will usher in the golden age of the long-term.

Industry, "eight" structure appears, quality companies continue to strengthen competitive advantage. Since 2014, a continuation of last year's downturn in the overall magnetics business, but the difference between enterprises started to increase, high-end products show a "rainbow night", 20% of the company at full capacity to deal with the continuous release of high demand, 80% of enterprises closed or out of business, so the magnetics industry to capacity curtain went up on the quality of listed companies will continue to strengthen competitive advantage.


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January 23 news, the Ministry issued a notice on the 22nd, was held to determine the focus of Rare Earth provinces (regions) and corporate work conference on January 28.

According to the notice, the content of the meeting was summarized in 2011, "a number of opinions" issued, the main work and achievements of the rare earth industry to carry out; analysis of the new situation facing the industry and the problems; further clarify "Thirteen Five" and recent work in the direction and requirements, the main task of the deployment in 2015 and priorities.

By then, the rare member inter-ministerial coordination unit, the State Council Legislative Affairs Office, China Securities Regulatory Commission, the relevant provinces (autonomous regions and municipalities) rare earth industry management department, six large enterprise groups of rare earth, rare earth enterprises focus on the person in charge and some research institutes, China Rare Earth industry associations responsible persons will participate.

In addition, based on the information the media survey, the current RE market is not short off-season, this week, the price of collective rebound, the highest increase of nearly 8%, and the overall stock market low.

The industry believes that the program has been set up six Rare Earth Group MIIT record, coupled with an unprecedented round of rare intensity hitting the Ministry of Commerce decided to abolish tariffs on exports of rare earths, rare earths national attention on the value can be seen, will make the rare earth market has already fallen to the bottom of the welcome warm round of accelerated development.


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