China tightens stranglehold on rare earth minerals
By Peter Foster in Beijing
Published: 11:35AM BST 02 Jun 2010 China is to further tighten its stranglehold on the mining of rare earth metals essential for the manufacture of high-tech products from iPods to wind turbines and military missiles. Mining rights for the 17 rare earth elements will now be restricted to only a handful of Chinese state-controlled mining companies, according to a draft proposal submitted this week for approval to China’s State Council, or cabinet. The move comes just six months after China – which produces 95pc of the world’s rare earth metals – capped production levels for 2010 and imposed a moratorium on all new mining licenses until June 30, 2011. The increased restrictions, reported by the state-run Xinhua news agency, are likely to deepen international concerns that China is unfairly hoarding its reserves of rare earth metals and other key raw materials at a time of rising global demand. The 17 elements from the middle of the Periodic Table are used in magnets, lasers, computer monitors, fibre-optic cables, cell phones, ceramics, stainless steel and are also essential for the on-going development of green technologies, such as low-energy light bulbs, wind turbines and batteries for hybrid and electric cars. In a separate case, the US, the EU and Mexico has already taken legal action at the World Trade Organisation (WTO) against Chinese import restrictions on nine key raw materials nine key raw materials including coke, bauxite, fluorspar and magnesium. With trade relations already fraying, experts have warned of the potentially damaging consequences of a further confrontation if developed countries now follow up with a WTO legal action against China’s rare earth metal restrictions. Developed countries, including the US, are almost totally reliant on China for rare earth metals after years of cheap Chinese exports in the 1980s and 1990s rendered Australian and American rare earth mines uneconomic. China says that its restructuring of the rare earth mining industry is intended to conserve reserves and maintain prices after years of over-exploitation that has damaged the country’s environment. …
