United States, "Washington Post", the original question: Why China to act as a responsible stakeholder? Earlier this week, China announced on rare earth exports, will act in accordance with the global rules of the game.

In this regard, "Wall Street Journal" explained: China canceled the strategic value of mineral export quotas. This restriction policy a decade ago, has triggered a global trade dispute, prompting some countries to reduce dependence on Chinese supplies ...... British North Quayle Blue Oak analyst Frank Tang (sound), said: "This change may be due to the pressure of the WTO (China against). China said that as a WTO member, China must comply with WTO rules. "

In contrast with the usual view, China is actually like a responsible supporter of global economic rules of the game, as acting, rather than a country founded by the United States is determined to weaken the system. Changes in domestic rules to comply with its international obligations, is China policy coordination to maintain an example of a more open economy. This is a victory for global economic governance, and is easily achieved.

Of course, whether living or global political economy, in fact, is not so simple. Ed Crooks in the "Financial Times" explained that Chinese cooperation for another reason: "The United States Department of Defense, a former adviser believes that China is unlikely to maintain control of the global rare earth market, because countries in improving the efficiency and to find other sources. "

So in other words, China rare earth policy results in 2010, the WTO has made a ruling adverse market reaction is prices, severely weakened China market dominance in the rare earth sector. China WTO ruling suddenly default, it seems not considered concessions. This is consistent with a point I made last year - the most powerful economic strategy is market forces and policy responses at the same time play a role. Russia's economic sanctions is the case, the issue is now on the Chinese rare earth as well.

This is also an example of the role of the system - you can choose as China reacted like Russia, but it opted for a more pro-neoliberal road. Russia, Venezuela and other countries when they are first and foremost export prices fall, trying to challenge this system. The results of these countries, what's happening in China in the eyes. Now Beijing is willing to "subsidies" in some countries, in order to advance their own national interests. But involves the global economy, China attaches great importance to the interests of the global system to get, even more than the system of dissatisfaction. Therefore, China will remain a responsible stakeholder.


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China the world's major producers of export ban revoked decade in the international market set off no small vibration rare, ASX listed rare earths miner Carolina stock price fell sharply. Faced with the new changes, alternative suppliers operating prospects being tortured again.

ACB News "Macao and China Finance Online" report, after China set quotas on exports of rare earths, forcing an international scramble to find alternative sources of supply of customers. Now entered the production phase of the project is only in Australia overseas Carolina, United States molybdenum company (Molycorp) crude saltpeter tyndareus tapas rare earth ore project.

Rare earth mine industrial "gold", with excellent electromagnetic and other physical properties of light can be composed with other materials with different properties, a wide variety of new materials, widely used in the manufacture of defense, IT and transportation industry high-tech products.

According to rough statistics, China currently controls 90 percent of the global supply of rare earths, after 2010 the Chinese government slashed export quotas, US, EU and Japan have the World Trade Organization (WTO) protests, accusing China aims to lift restrictions on the export of rare earth product prices. Subsequently WTO that China change the quota system for the domestic availability of cheap raw material supply of rare earth products manufacturers to bring a competitive advantage in the market, and in the last judgment, China failed to give adequate reasons for quota adjustments. Then the Chinese government agreed to withdraw quotas.

December 31, the Chinese Ministry of Commerce issued the "2015 list of goods export license management" clearly Cancel rare earth export quotas. Chinese exports of rare earth ore still obtain relevant permits future, but exports will no longer be restricted. China Rare Earth Industry Association, a responsible person said, details about the rare earth industry, the regulatory system is still under development.

Carolina is one of Australia's current major new rare earth market forces, with more than a dozen mines in Western Australia, Malaysia and processing plants have been put into operation. In recent years, the rare earths miner pressure frequently affected by the loss of frustration, plant license application by the Malaysian environmental organizations strongly resisted, after barely put into troubled by technical problems, not the high operating costs, while still bear the gradual decline of the price of rare earth .

China canceled the export quota of rare earth brings the latest a heavy blow. After the Christmas and New Year holidays ASX trading in the first week, Rainer ASX share price fell even two days, the cumulative decline of nearly 14%, the latest price quoted at 6.2 points.

As early as 2011 peak price of rare earth, the stock was as high as 1 AUD Carolina. However, the current price has dropped rare for many manufacturers in terms of "unsustainable" level.

"Fortune Xiang Yi"

Running track rare earth prices "roller coaster" type of so many mining companies such as Carolina, as well as industry investors by surprise, but China revoked export quotas or overwhelmed as a market return to a stable signal. According to the Wall Street Journal quoted the Chinese Academy of International Trade and Economic Cooperation Ministry of Commerce Jinbo Song experts as saying that this quota system the most important factor is government wants to play a greater role in guiding the market.

Under the self-regulation of the market mechanism, rare earth prices will better reflect changes in supply and demand, the healthy development of rare earth industry or can be expected.

The past two years, the world's rare earth supply diversification began to accelerate, the capital of which is to play an active force. Ben previously reported, in Australia, China, East China Mineral Exploration and Development Bureau (ECE) affiliates Arafura Resources Limited (Arafura, ASX: ARU) rare earth project is expected to be commissioned within five years.

China Nonferrous Metal Construction Company (NFC) intends to join the Australian energy company Greenland Minerals (ASX: GGG) work together to build a highly integrated global rare earth supply chain.

Beijing Cong Lin Holdings ASX listed company Orion Metals (ASX: ORM) recently obtained a new license from the mine to the exploration of mineral resources, the Ministry of Queensland, Ramsay RE project is about to start. Its holdings of rare earth exploration, another developer Northern Mining Limited (Northern Minerals, ASX: NTU) 's Northern Territory Browns Range Heavy Rare Earth (HRE) project has also demonstrated a strong development prospects.


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Starting this year, China's rare earth export quota management officially canceled. This initiative is not only to deal with the results of WTO rulings, but also to build a more open market economy system active choice. After the quota management canceled, China's rare earth industry regulatory focus will be more from the export sector to domestic production processes.

From January 1 this year, China began to implement a formal cancellation of rare earth export quota management for many years. Enterprises need to take to apply for export contracts to export, no longer provide approval. Along with the elimination of export quota management system as well as bauxite, coke, tungsten and tungsten products, silicon carbide, manganese, molybdenum and fluorspar.

Quota accidental

Export quotas, refers to the government in a period of time or the amount of the export volume of exports of certain provisions of a ceiling. For a long time, China has accounted for only 23 percent of the world's supply of rare earth reserves more than 90 percent of rare earth products to the international market. Some countries also have such products exports of rare earth resources such as long-term zero, but at an affordable price to import large quantities of rare earth resources. RE cheap price and value have been contrary, is known as the "gold selling price of cabbage." Taking into account the resources, environmental protection and other issues, the Chinese government on the mining, production and export of rare earth synchronization of all aspects of the management measures implemented, the implementation of tariff quotas and export management. May 2011, the State Council issued the "Opinions on Promoting sustainable and healthy development of rare earth industry," reiterated the Chinese government through integrated management measures to protect the environment, conserve rare earth resources policy objectives.

March 2012, Europe and other countries and regions once the larger Chinese rare earths, tungsten, the proportion of total global reserves, export restrictions affect the development of related industries by countries to resort to WTO dispute settlement mechanism. March 2014, WTO preliminary ruling of export quotas for rare earths, tungsten, molybdenum and other related products to take, export licenses and export price measures are not consistent with its relevant regulations. Since then our appeal, affirm our policy objective is in line with WTO rules, the WTO in August but still made a final ruling regrettable conclusion, while comprehensive resource and environmental protection measures taken in recognition of China's rare earth determining China's rare earth export policy violations.

Respect the market active choice

"To become a bad thing for a good thing." Professor Chinese Academy of Social Sciences Institute of International Law 黄东黎 said. Some only consider when formulating policies on local traditions and authorities in their fields of interest, lack of our country is already a member of the WTO and the need to comply with WTO rules recognize. And no matter what the policy for consideration under the WTO framework, must be in accordance with the dispute settlement mechanism to resolve trade frictions arise, the losing party must enforce the ruling. In this process, the need to improve the ability to use the rules of the game.

The cancellation of rare earth export quota management is to honor its WTO commitments, is to deal with the results of WTO rulings, but also China to let the market play a decisive role in the allocation of resources, active choice to build a more open market economy. Third Plenary Session of the Party's eighteenth resolution states, focus of the market plays a decisive role in the allocation of resources and better play the role of government, to deepen economic reform.

After the cancellation of rare earth export quotas of rare earth export mainly by market demand to decide. One is to reduce the burden of rare earth export enterprises, enterprises do not need to go for a quota; the second is the compression of space, smuggling and other non-normal exports of rare earth export volume normal channels will be enhanced, industry will be more healthy and orderly development of rare earths.

Many industry insiders believe that this policy change has little effect on the market. Because the international market in recent years has undergone major changes in the pattern of rare earths, the annual quota has not run out. RE current international market downturn, the price of rare earth products has dropped to its lowest point since 2011. Cancel RE quota of market and industry will not happen much impact, long-term price trend is still decided by supply and demand.

On the other hand, since 2013, two rounds of rare earths "hitting" the effectiveness of emerging, illegal exploitation has been checked, the industry has improved production order. Industry consolidation is progressing positively, six rare earth group formed expected to heat up. Related brokerage analysts believe that the rare earth industry has entered the upward inflection point, with the resources tax adjustment, purchasing and storage is expected to heat up, will further push up domestic rare earth prices.

Product development strategy to strengthen the resource

After the quota management canceled, China's rare earth industry regulatory focus will be more from the export sector to domestic production processes. The next step, whether it is for environmental protection, or restructuring, we need to further strengthen the exploitation of rare earth and other resource products, production, processing and utilization management. From a practical perspective, the development strategy of resource products need to be strengthened.

Deputy Director of the Ministry of rare earth do 史瑞庭 at the recently held China Science and Technology Forum, the future of rare earth industry through continuous improvement management mechanism to increase the implementation of national policies, implementation and enforcement, protect the country's valuable strategic resource, so that the rare earth industry to embark healthy, orderly and sustainable development.

In addition, rare earth deep processing and industrial upgrading is the future direction of the rare earth industry. "Rare earth materials is the development of high-tech and cutting-edge technology indispensable defense of key raw materials, high-performance, high purity and develop new applications of rare earth materials development trend." Chinese Academy of Engineering, Chinese Society of Rare Earths, chairman Gan Yong said. He suggested that the high-end of China's rare earth products is heavily dependent on imports, the future must focus on the development of key technologies, develop a new generation of low-cost and stable batch of rare earth materials and preparation techniques, meet other intelligent control and detection of high-end applications.

East China University Professor Lu Guanzhong also said that the current rare earth catalytic materials or catalytically active component, has been widely used in chemical, petroleum autocatalyst and forward air purification, catalytic combustion, energy and chemical industry extends. The next step should be to make the rare earth catalytic materials play a greater role in environmental management and development of new energy and other fields.


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It was reported recently China canceled export quotas for rare earths, Japan Japan-related industry that has gained a new channel, dramatically reducing dependence on Chinese rare earths, so China The impact on Japan's export policy adjustment is not large.

Reported that in 2010 when China began to restrict exports of rare earths, Japan's imports from China account for about eighty percent of the total import volume of rare earth, rare earth prices subsequently rose sharply once, a tremendous impact on related industries. But Japanese companies on the one hand the development of alternative technologies available through other means new sources of rare earths, on the one hand to control the use of rare earth, and therefore the real impact of the Japanese industry suffered quite limited.

Nissan Vice President Toshiyuki Shiga said, "(Nissan) in promoting the development of related technologies, while reducing the use of rare earth, and find the sources of supply outside of China." Toshiba President Hisao Tanaka said, "Now the price has come down somewhat, (China this policy adjustment) has no effect."

Japan's report also quoted experts as saying that the rare earths in the field of electric vehicles, fuel cells, wind power has been widely used, is an indispensable resource, China itself will rise in demand for rare earths in the future, so the supply of rare earths is still possible tense situation.


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