• 1 hour Canadia Ltd. Returns To Sudan For First Time Since Oil Price Crash
  • 3 hours Syrian Rebel Group Takes Over Oil Field From IS
  • 3 days PDVSA Booted From Caribbean Terminal Over Unpaid Bills
  • 3 days Russia Warns Ukraine Against Recovering Oil Off The Coast Of Crimea
  • 3 days Syrian Rebels Relinquish Control Of Major Gas Field
  • 3 days Schlumberger Warns Of Moderating Investment In North America
  • 3 days Oil Prices Set For Weekly Loss As Profit Taking Trumps Mideast Tensions
  • 3 days Energy Regulators Look To Guard Grid From Cyberattacks
  • 3 days Mexico Says OPEC Has Not Approached It For Deal Extension
  • 3 days New Video Game Targets Oil Infrastructure
  • 3 days Shell Restarts Bonny Light Exports
  • 3 days Russia’s Rosneft To Take Majority In Kurdish Oil Pipeline
  • 3 days Iraq Struggles To Replace Damaged Kirkuk Equipment As Output Falls
  • 4 days British Utility Companies Brace For Major Reforms
  • 4 days Montenegro A ‘Sweet Spot’ Of Untapped Oil, Gas In The Adriatic
  • 4 days Rosneft CEO: Rising U.S. Shale A Downside Risk To Oil Prices
  • 4 days Brazil Could Invite More Bids For Unsold Pre-Salt Oil Blocks
  • 4 days OPEC/Non-OPEC Seek Consensus On Deal Before Nov Summit
  • 4 days London Stock Exchange Boss Defends Push To Win Aramco IPO
  • 4 days Rosneft Signs $400M Deal With Kurdistan
  • 4 days Kinder Morgan Warns About Trans Mountain Delays
  • 4 days India, China, U.S., Complain Of Venezuelan Crude Oil Quality Issues
  • 5 days Kurdish Kirkuk-Ceyhan Crude Oil Flows Plunge To 225,000 Bpd
  • 5 days Russia, Saudis Team Up To Boost Fracking Tech
  • 5 days Conflicting News Spurs Doubt On Aramco IPO
  • 5 days Exxon Starts Production At New Refinery In Texas
  • 5 days Iraq Asks BP To Redevelop Kirkuk Oil Fields
  • 6 days Oil Prices Rise After U.S. API Reports Strong Crude Inventory Draw
  • 6 days Oil Gains Spur Growth In Canada’s Oil Cities
  • 6 days China To Take 5% Of Rosneft’s Output In New Deal
  • 6 days UAE Oil Giant Seeks Partnership For Possible IPO
  • 6 days Planting Trees Could Cut Emissions As Much As Quitting Oil
  • 6 days VW Fails To Secure Critical Commodity For EVs
  • 6 days Enbridge Pipeline Expansion Finally Approved
  • 6 days Iraqi Forces Seize Control Of North Oil Co Fields In Kirkuk
  • 6 days OPEC Oil Deal Compliance Falls To 86%
  • 7 days U.S. Oil Production To Increase in November As Rig Count Falls
  • 7 days Gazprom Neft Unhappy With OPEC-Russia Production Cut Deal
  • 7 days Disputed Venezuelan Vote Could Lead To More Sanctions, Clashes
  • 7 days EU Urges U.S. Congress To Protect Iran Nuclear Deal
Alt Text

Busting The Lithium Bubble Myth

Lithium demand continues to grow…

Alt Text

World’s Biggest Miner Prepares For The EV Boom

The world’s top mining company…

China and Rare Earths - Monopoly for Now

China and Rare Earths - Monopoly for Now

First, the bad news - China's constrained rare earth supplies will be an "irreversible trend" and prices will remain at high levels, according to Zhang Zhong, general manager of Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co.

Zhang should know, as his concern is China’s leading rare earths producer – the Baatou mine produces more than 95 percent of China’s production, while Chinese mines currently account for 97 percent of global supplies.

The increase in global demand for rare earth metals has sent prices soaring in world markets. According to the China Nonferrous Metals Industry Association, since January rare earth metal product prices jumped 200 percent, with the prices of some of the rarer commodities rising 500-1,900 percent. Since January China's exports grew 830 percent to $1.54 billion.

Now, the good news – despite fears of Western capitalists, Beijing apparently has no immediate plans to curtail supplies.

And finally, the interesting news.

The Chinese Ministry of Industry and Information Technology said on its website that it will conduct a broad audit of domestic rare earth metal producers in Inner Mongolia to check for production quota breaches. The audit’s intention is to uncover rare earth metals producers breaching existing regulations and continuing covert trading in rare earth metals.
Analysts nervously track Chinese policy, as since 2003 China has reduced the amount of rare earths available for export by 40 percent, while over the past decade global demand has tripled from 40,000 to 120,000 tons. 

Earlier this year China curtailed its total output of rare earth oxides to 93,800 tons, up only 5 percent from 2010 production levels and also recently raised taxes on rare earth elements for the second time, leading foreign analysts to conclude that the era of “cheap” rare earths is over.

Rare earth elements (REEs) are used to produce everything from wind turbines to solar cells and low-energy light-bulbs as well as iPhones and X-ray machines. Most ominously for Washington, RREs are also a strategic component of many U.S. cutting-edge high-tech weapons systems, incorporated in the guidance systems of missiles and laser-guided munitions.

But the soaring RRE prices have led to a wild East “gold rush,” with a number of freelance entrepreneurs setting up in Inner Mongolia, a too wild and wooly capitalist endeavor the that audit is designed to curtail.

The record-high RRE prices have also sparked a flurry of exploration activity throughout Central Asia, most notably in Mongolia, where a 2009 estimate by the U.S. Geological Survey concluded that Mongolia has 31million tons of rare earth reserves. Mongolia has some of the world's richest deposits of gold and copper, uranium, coal, fluorspar as well as RREs such as tantalum, niobium, thorium, yttrium and zircon.

Six months ago California-based Green Technology Solutions and Rare Earth Exporters of Mongolia formed a joint venture to exploit Mongolia’s RRE potential, sending out their first shipment in April to South Korea via Vladivostok.

So, the RRE race is on. What is perhaps most interesting is that Western analysts fear covert potential malevolent motives dictating Chinese policy on RRE exports when, in fact, up to now Beijing has behaved as a responsible member of the global economic community.

Of course, soaring RRE prices have nothing to do with Chinese policy.

By. John C.K. Daly of  OilPrice.com




Back to homepage


Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News