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

Video Miami Cubans Divided on New US Policy

While older, more conservative Cuban Americans have promoted anti-Castro political movement for years, younger generations say economically, it is time for change More

2014 Sees Dramatic Uptick in Boko Haram Abductions

Militants suspected in latest mass kidnapping of over 100 people in Gumsuri, Nigeria on Sunday More

Video Cuba Deal Is Major Victory for Pope

Role of Francis hailed throughout US, Latin America - though some Cuban-American Catholics have mixed feelings 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.
Sudan School Becomes Target of Aerial Attacksi
X
December 19, 2014 12:45 AM
The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video Sudan School Becomes Target of Aerial Attacks

The school dropout rate is at an all-time high in Sudan's South Kordofan state because many schools have been destroyed during the three-year civil war between the government and SPLA-N rebel forces. Adam Bailes visited Sudan's Nuba Mountains' region and reports many children are simply too scared to go to school
Video

Video VOA Reporter Tours Devastated Peshawar School

Islamist militants wearing military uniforms and strapped with explosives attacked a military run school Tuesday in the northwestern Pakistani city of Peshawar. At least 141 people were killed in the horrific attack, most of them young students. VOA reporter Ayaz Gul visited the devastated school and attended the funeral of the principal who courageously tried to save her students from the deadly attack.
Video

Video Nigerians Fleeing Boko Haram Languish in Camp Near Capital

In its five-year effort to impose Islamic law in northeastern Nigeria, the Boko Haram extremist group has killed thousands of people and forced hundreds of thousands to flee. Some of those who ran for their lives now live in squalor on the edges of the capital, Abuja. Chris Stein reports for VOA.
Video

Video Putin Says Russian Economy Will Emerge Stronger

Russian President Vladimir Putin has said his country's sinking economy will not only recover but also become stronger, despite falling oil prices and Western sanctions over Ukraine. VOA's Daniel Schearf reports.
Video

Video Detained Turkish Journalists Follow Teachings of US-Based Preacher

The Turkish government’s jailing of critical journalists has sparked international condemnation and is being seen as an effort to undermine the followers of an ailing Turkish preacher based in the United States. VOA religion reporter Jerome Socolovsky has more.
Video

Video ‘Anti-Islamization’ Marches Increase Tensions In Germany

Anti-immigrant rallies in Germany have been building in recent weeks, peaking Monday night in the city of Dresden where tens of thousands of people turned out to demonstrate against what they call the ‘Islamization’ of the West. Germany has offered asylum to more Syrian refugees than any other country, and this appears to have set off the protests. Henry Ridgwell reports from London.
Video

Video Aceh Rebuilt Decade After Tsunami, But Scars Remain

On December 26, 2004 there was an earthquake in the Indian Ocean so powerful it caused the Earth’s axis to wobble a few centimeters. Onshore on the island of Sumatra, the resulting tsunami was devastating. A decade later, VOA Correspondent Steve Herman reports from Banda Aceh, Indonesia, where although there is little remaining evidence of the physical devastation, the psychological scars among survivors remain.
Video

Video Refugees Living in Kenya Long for Peace in the Home Countries

Kenya is host to numerous refugees seeking safe haven from conflict. Immigrants from Somalia face challenges in their new lives in Kenya. Ahead of International Migrants Day (December 18) Lenny Ruvaga has more for VOA News from the Kenyan capital.

All About America

AppleAndroid