China to release new regulations for rare-earth industry

By Fang Yunyu Source:Global Times Published: 2011-8-9 2:11:00

China is preparing to issue new rules for the rare- earth industry during the second half of the year, in an effort to crack down on illegal and excessive mining, according to Jia Yinsong, an inspector at the raw materials division of the Ministry of Industry and Information Technology Monday.

Jia said at the China Rare Earth Forum, held Monday in Baotou, Inner Mongolia, that the ministry is planning to issue a series of regulations on the sector, including providing financial support, raising the entry threshold for companies and stipulating qualifications for mergers and acquisitions.  

"It is important to develop rare-earth companies into big enterprises," Chen Zhanheng, head of research at the Chinese Society of Rare Earths, told the Global Times Monday.

The ministry and other five government agencies announced on Friday that the country will launch a nationwide campaign in August to combat illegal and excessive mining and check the environmental conditions at mines.

As the largest rare-earth producer accounting for more than 90 percent of the supply of the metals around the world, China sets export quotas for the rare minerals each year. The total export quotas of rare earths are set at 30,184 tons this year, lower than the 30,259 tons last year.

However, Chen said the actual exports exceed the quotas, since "some companies in the sector are unable to say no to the good market demand."

The value of rare-earth exports between January and June surged to $1.54 billion, an increase of 930 percent over the same period of last year, according to statistics from the Nonferrous Metals Society of China.

The society said the prices of rare earths climbed by more than 200 percent in the first half, though in July there was a decline of around 15 percent.

Gan Yong, vice president of the China Academy of Engineering, said Monday that he thinks the prices for rare earths in the second half will not be higher than that of the first half.

"It's unlikely for the prices to rise further because the buyers are already finding it difficult to cope with the high prices," Chen said.

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