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, 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

Beijing Warns US on S. China Sea Patrols

Warning follows news reports Thursday that US military is planning to sail warships close to artificial islands Beijing has been aggressively building More

Indian PM Calls for Unity Amid Tense Climate Over Beef Attacks

Recent series of beef-related incidents seen as signs of rising intolerance toward Muslims and other religious minorities More

Why These Are New York City's Most Treasured Spaces

Under threat of jail time and fines, some New York property owners are not allowed to renovate their spaces without prior approval More

This forum has been closed.
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.
House Republicans in Chaos as Speaker Favorite Withdrawsi
Jim Malone
October 09, 2015 12:32 AM
The Republican widely expected to become the next speaker of the House of Representatives shocked his colleagues Thursday by announcing he was withdrawing his candidacy. The decision by Majority Leader Kevin McCarthy means the race to succeed retiring Speaker John Boehner is now wide open. VOA National Correspondent Jim Malone reports.

Video House Republicans in Chaos as Speaker Favorite Withdraws

The Republican widely expected to become the next speaker of the House of Representatives shocked his colleagues Thursday by announcing he was withdrawing his candidacy. The decision by Majority Leader Kevin McCarthy means the race to succeed retiring Speaker John Boehner is now wide open. VOA National Correspondent Jim Malone reports.

Video German, US Officials Investigate Volkswagen

German officials have taken steps to restore some of the reputation their car industry has lost after a recent Volkswagen diesel emissions scandal. Authorities have searched Volkswagen headquarters and other locations in an effort to identify the culprits in the creation of software that helps cheat on emission tests. Meanwhile, a group of lawmakers in Washington held a hearing to get to the bottom of the cheating strategy that was first discovered in the United States. Zlatica Hoke reports.

Video Why Are Gun Laws So Hard for Congress to Tackle?

Since taking office, President Barack Obama has spoken out or issued statements about 15 mass shootings. The most recent shooting, in which 10 people were killed at a community college, sparked outrage over the nation's gun laws. But changing those laws isn't as easy as many think. VOA's Carolyn Presutti reports.

Video Hungary Criticized for Handling of Refugees

Amnesty International has accused Hungary of breaking multiple international and European human rights laws in its handling of the refugee crisis. As Henry Ridgwell reports, thousands of migrants and refugees continue to travel through the Balkans to Hungary every day.

Video Iraqi-Kurdish Teachers Vow to Continue Protest

Sixteen people were injured when police used tear gas and rubber bullets to disperse teachers and other public employees who took to the streets in Iraq’s Kurdish north, demanding their salaries from the Kurdish Regional Government (KRG). VOA’s Dilshad Anwar, in Sulaimaniya, caught up with protesting teachers who say they have not been paid for three months. Parke Brewer narrates his report.

Video Syrian Village Community Faces Double Displacement in Lebanon

Driven by war from their village in southwestern Syria, a group of families found shelter in Lebanon, resettling en masse in a half-built university to form one of the biggest settlements of its kind in Lebanon. Three years later, however, they now face being kicked out and dispersed in a country where finding shelter as a refugee can be especially tough. John Owens has more for VOA from the city of Saida, also known as Sidon.

Video Bat Colony: Unusual Tourist Attraction in Texas

The action hero Batman might be everyone’s favorite but real bats hardly get that kind of adoration. Put more than a million of these creatures of the night together and it only evokes images of horror. Sarah Zaman visited the largest urban bat colony in North America to see just how well bat and human get along with each other.

Video Device Shows Promise of Stopping Motion Sickness

It’s a sickening feeling — the dizziness, nausea and vomiting that comes with motion sickness. But a device now being developed could stop motion sickness by suppressing certain signals in the brain. VOA’s Deborah Block reports.

Video Making a Mint

While apples, corn, and cranberries top the list of fall produce in the US, it’s also the time to harvest gum, candy, and toothpaste—or at least the oil that makes them minty fresh. Erika Celeste reports from South Bend, Indiana on the mint harvest.

Video Activists Decry Lagos Slum Demolition

Acting on a court order, authorities in Nigeria demolished a slum last month in the commercial capital, Lagos. But human rights activists say the order was illegal, and the community was razed to make way for a government housing project. Chris Stein has more from Lagos.

Video TPP Agreed, But Faces Stiff Opposition

President Barack Obama promoted the Trans-Pacific Partnership on Tuesday, one day after 12 Pacific Rim nations reached the free trade deal in Atlanta. The controversial pact that would involve about 40 percent of global trade still needs approval by lawmakers in respective countries. Zlatica Hoke reports Obama is facing strong opposition to the deal, including from members of his own party.

Video Ukranian Artist Portrays Putin in an Unusual Way

As Russian President Vladimir Putin was addressing the United Nations in New York last month, he was also being featured in an art exhibition in Washington. It’s not a flattering exhibit. It’s done by a Ukrainian artist in a unique medium. And its creator says it’s not only a work of art - it’s a political statement. VOA’s Tetiana Kharchenko has more.

VOA Blogs