News / Asia

China's Rare Earths Export Quota Cuts Triggers Concerns

A worker waters the site of a rare earth metals mine at Nancheng county of Jiangxi province, China, 29 Dec 2010
A worker waters the site of a rare earth metals mine at Nancheng county of Jiangxi province, China, 29 Dec 2010

An announcement this week by China that it plans to cut export quotas for rare earth minerals next year is raising concerns about future supplies of the increasingly sought after natural resource that is a crucial component in a wide range of high-tech goods. The move is sparking trade concerns and helping boost the hunt for and production of rare earths outside of China.

Right now, about 97 percent of the world's production of rare earth minerals is located in China.

So, when China announced this week that it was cutting its quotas for the export of rare earths,  countries and companies that rely on the elements for the production of everything from high-tech electronic devices to electric cars, wind turbines and defense systems began voicing objections.

Japan's electronics giant Sony says the move is a hindrance to free trade and says it will try to reduce its reliance on Chinese supplies.

U.S. representatives at the World Trade Organization say they're "very concerned" about the restraints and have raised the issue with China. The U.S. says it may complain to the WTO about China's export restraints.

China argues that its export controls are in line with World Trade Organization rules.

Foreign Ministry spokeswoman Jiang Yu says the measures are necessary to protect China's environment and supply of resources. She adds that in the future China will continue to provide rare earth products to the international market.

Concern over the export of rare earth minerals has been building in recent months.

China slashed export quotas for the minerals in the second half of 2010, citing a shortage of supply for domestic manufacturers.  And, when it was embroiled in a diplomatic dispute with Tokyo, shipments of the minerals to Japan were temporarily interrupted.

Listen to the extended interview with Gabe Collins


Gabe Collins, the co-founder of China www.chinasignpost.com, a Web site that focuses on China research and analysis, says that he does not believe China will let the issue cause too much unnecessary friction in its relations with other countries.

But, he adds that if there is some dispute again with Japan, the rare earths issue could come up again. China and Japan are the two major rare earth component producers in the world.

China's moves to cut quotas, Collins says, are ultimately reflection of its industrial policy.

"What they are trying to do. There is two things," said Collins. "One, is you're seeing more and more electronics manufacturing in China, that's keeping rare earths at home by itself. The second thing is you're seeing, this is a manifestation of a Chinese industrial development policy. Namely, they want to keep they want to keep the higher value added steps of the manufacturing chain in China."

In a recent China SignPost report on China's rare earth minerals and the debate it is sparking, Collins suggests that the U.S. start building up a strategic reserve of the minerals. He also says the U.S. and other governments should discuss the issue with China at high-level meetings.

"Given the strategic nature of these elements. How critical they are both to defense applications and a lot of the commercial applications, I think this would certainly be a subject that would be very much worth putting on the agenda for example in the Strategic and Economic Dialogue with China, perhaps some of the WTO discussions between members of the European Union, China, Japan and the United States."

While the decision is raising concerns from governments, it is giving companies outside of China that are already in the business of mining rare earth minerals or working to restart projects a big boost.

Companies such as Australia's Lynas Corporation and the U.S.-based Molycorp have seen their share prices shoot up since the decision was announced.

Molycorp resumed operation of its rare earth metal facility in California last week. The site was shut down in 2002 amid environmental concerns and low costs for rare earth metals from mines in China.

The U.S. state of Alaska and others are actively assessing the prospects for the mining of rare earths.

Bob Swenson is the director of Alaska's division of geological and geophysical surveys.

"The Bokan area is actually the only known minable occurrence of rare earth elements in Alaska. We do have many areas specifically in interior Alaska as well as down in southeast Alaska where we do have indications of permissible geology for rare earths and those are the areas we've really been focusing on," he said.

In November, the U.S. Geological Survey carried out its first-ever assessment for rare earths and found that deposits that total about 13 million metric tons had been found in 14 states.

World demand for rare earths is currently at about 120,000 metric tons per year, with China accounting for most of that demand. The remainder is split between Japan, the United States and Europe.

You May Like

How to Safeguard Your Mobile Privacy

As the digital world becomes more mobile, so too do concerns about eroding privacy and increased hacking More

'Desert Dancer' Chronicles Iranian Underground Dance Troupe

Film by Richard Raymond is based on true story of Afshin Ghaffarian and his friends More

Obesity Poses Complex Problem

Professor warns of obesity’s worldwide health impact More

This forum has been closed.
Comments
     
There are no comments in this forum. Be first and add one

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Rolling Thunder Run Reveals Changed Attitudes Towards Vietnam Wari
X
Katherine Gypson
May 25, 2015 1:32 AM
For many US war veterans, the Memorial Day holiday is an opportunity to look back at a divisive conflict in the nation’s history and to remember those who did not make it home.
Video

Video Rolling Thunder Run Reveals Changed Attitudes Towards Vietnam War

For many US war veterans, the Memorial Day holiday is an opportunity to look back at a divisive conflict in the nation’s history and to remember those who did not make it home.
Video

Video Female American Soldiers: Healing Through Filmmaking

According to the United States Defense Department, there are more than 200-thousand women serving in the U.S. Armed Forces.  Like their male counterparts, females have experiences that can be very traumatic.  VOA's Bernard Shusman tells us about a program that is helping some American women in the military heal through filmmaking.
Video

Video Iowa Family's Sacrifice Shaped US Military Service for Generations

Few places in America have experienced war like Waterloo. This small town in the Midwest state of Iowa became famous during World War II not for what it accomplished, but what it lost. As VOA’s Kane Farabaugh reports, the legacy of one family’s sacrifice is still a reminder today of the real cost of war for all families on the homefront.
Video

Video On Film: How Dance Defies Iran's Political Oppression

'Desert Dancer' by filmmaker Richard Raymond is based on the true story of a group of young Iranians, who form an underground dance troupe in the Islamic Republic of Iran. This is the latest in a genre of films that focus on dance as a form of freedom of expression against political oppression and social injustice. VOA’s Penelope Poulou has more.
Video

Video Turkey's Ruling Party Trying to Lure Voters in Opposition Stronghold

Turkey’s AK (Justice and Development) Party is seeking a fourth successive general election victory, with the goal of securing two-thirds of the seats in Parliament to rewrite the constitution and change the country's parliamentary system into a presidential one. To achieve that, the party will need to win seats in opposition strongholds like the western city of Izmir. Dorian Jones reports.
Video

Video Millions Flock to Ethiopia Polls

Millions of Ethiopians cast their votes Sunday in the first national election since the 2012 death of longtime leader Meles Zenawi. Mr. Meles' party, the Ethiopian People's Revolutionary Democratic Front, is almost certain of victory again. VOA's Anita Powell reports from Addis Ababa.
Video

Video Scientists Testing Space Propulsion by Light

Can the sun - the heart of our solar system - power a spacecraft to the edge of our solar system? The answer may come from a just-launched small satellite designed to test the efficiency of solar sail propulsion. Once deployed, its large sail will catch the so-called solar wind and slowly reach what scientists hope to be substantial speed. VOA’s George Putic reports.
Video

Video FIFA Trains Somali Referees

As stability returns to the once lawless nation of Somalia, the world football governing body, FIFA, is helping to rebuild the country’s sport sector by training referees as well as its young footballers. Abdulaziz Billow has more from Mogadishu.
Video

Video With US Child Obesity Rates on the Rise, Program Promotes Health Eating

In its fifth year, FoodCorps puts more than 180 young Americans into 500 schools across the United States, where they focus on teaching students about nutrition, engaging them with hands-on activities, and improving their access to healthy foods whether in the cafeteria or the greater community. Aru Pande has more.
Video

Video Virginia Neighborhood Draws People to Nostalgic Main Street

In the U.S., people used to grow up in small towns with a main street lined by family-owned shops and restaurants. Today, however, many main streets are worn down and empty because shoppers have been lured away by shopping malls. But in the Del Ray neighborhood of Alexandria, Virginia, main street is thriving. VOA’s Deborah Block reports it has a nostalgic feel with its small restaurants and unique stores.

VOA Blogs