Best of the Week
Most Popular
1. US Housing Market House Prices Bull Market Trend Current State - Nadeem_Walayat
2.Gold and Silver End of Week Technical, CoT and Fundamental Status - Gary_Tanashian
3.Stock Market Dow Trend Forecast - April Update - Nadeem_Walayat
4.When Will the Stock Market’s Rally Stop? - Troy_Bombardia
5.Russia and China Intend to Drain the West of Its Gold - MoneyMetals
6.BAIDU (BIDU) - Top 10 Artificial Intelligence Stocks Investing To Profit from AI Mega-trend - Nadeem_Walayat
7.Stop Feeding the Chinese Empire - ‘Belt and Road’ Trojan Horse - Richard_Mills
8.Stock Market US China Trade War Panic! Trend Forecast May 2019 Update - Nadeem_Walayat
9.US China Trade Impasse Threatens US Lithium, Rare Earth Imports - Richard_Mills
10.How to Invest in AI Stocks to Profit from the Machine Intelligence Mega-trend - Nadeem_Walayat
Last 7 days
Gold Golden 'Moment of Truth' Is Upon Us: $1,400-Plus or Not? - 18th June 19
Exceptional Times for Gold Warrant Special Attention - 18th June 19
The Stock Market Has Gone Nowhere and Volume is Low. What’s Next - 18th June 19
Silver Long-Term Trend Analysis - 18th June 19
IBM - Watson Deep Learning - AI Stocks Investing - Video - 18th June 19
Investors are Confident, Bullish and Buying Stocks, but… - 18th June 19
Gold and Silver Reversals – Impossible Not to Notice - 18th June 19
S&P 500 Stuck at 2,900, Still No Clear Direction - 17th June 19
Is Boris set to be the next Conservation leader? - 17th June 19
Clock’s Ticking on Your Chance to Profit from the Yield Curve Inversion - 17th June 19
Stock Market Rally Faltering? - 17th June 19
Johnson Vs Gove Tory Leadership Contest Grudge Match Betfair Betting - 17th June 19
Nasdaq Stock Index Prediction System Is Telling Us A Very Different Story - 17th June 19
King Dollar Rides Higher Creating Pressures On Foreign Economies - 17th June 19
Land Rover Discovery Sport Tailgate Not Working Problems Fix (70) - 17th June 19
Stock Market Outlook: is the S&P today just like 2007 or 2016? - 17th June 19
US China War - Thucydides Trap and gold - 16th June 19
Gold Stocks Bull Upleg Mounting - 16th June 19
Gold Price Seasonal Trend Analysis - Video - 16th June 19
Fethiye Market Fruit, Veg, Spices and Turkish Delight Tourist Shopping - 16th June 19
US Dollar Gold Trend Analysis - 15th June 19
Gold Stocks “Launch” is in Line With Fundamentals - 15th June 19
The Rise of Silver and Major Economic Decline - 15th June 19
Fire Insurance Claims: What Are the Things a Fire Claim Adjuster Does? - 15th June 19
How To Find A Trustworthy Casino? - 15th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match - Video - 14th June 19
Gold and Silver, Precious Metals: T-Minus 3 Seconds To Liftoff! - 14th June 19
Silver Investing Trend Analysis - Video - 14th June 19
The American Dream Is Alive and Well - in China - 14th June 19
Keeping the Online Gaming Industry in Line - 14th June 19
How Acquisitions Affect Global Stocks - 14th June 19
Please Don’t Buy the Dip in Nvidia or Other Chip Stocks - 14th June 19
A Big Thing in Investor Education is Explainer Videos - 14th June 19
IRAN - The Next American War - 13th June 19
Boris Johnson Vs Michael Gove Tory Leadership Grudge Match Contest - 13th June 19
Top Best VPN Services You Can Choose For Your iPhone - 13th June 19
Tory Leadership Contest Betting Markets Forecast - Betfair - 13th June 19
US Stock Market Setting Up A Pennant Formation - 13th June 19
Which Stocks Will Lead The Cannabis Rebound? - 13th June 19
The Privatization of US Indo-Pacific Vision - Project 2049, Armitage, Budget Ploys and Taiwan Nexus - 12th June 19
Gold Price Breaks to the Upside - 12th June 19
Top Publicly Traded Casino Company Stocks for 2019 - 12th June 19
Silver Investing Trend Analysis - 12th June 19
Why Blue-Chip Dividend Stocks Aren’t as Safe as You Think - 12th June 19
Technical Analysis Shows Aug/Sept Stock Market Top Pattern Should Form - 12th June 19
FTSE 100: A Top European Index - 12th June 19
Gold Surprise! - 11th June 19
How Forex Indicators are Getting Even More Attention in the Market? - 11th June 19
Stock Market Storm Clouds on the Horizon - 11th June 19
Is Your Financial Security Based On A Double Aberration? - 11th June 19
What If Stocks Are Wrong About Interest Rate Cuts? - 11th June 19
US House Prices Yield Curve, Debt, QE4EVER! - 11th June 19
Natural Gas Moves Into Basing Zone - 11th June 19
U.S. Dollar Stall is Good for Commodities - 11th June 19
Fed Running Out of Time and Conventional Weapons - 11th June 19
Trade Wars Propelling Stock Markets to New Highs - 11th June 19
Best Travel Bags for Summer Holidays 2019, Back Sling packs, water proof, money belt, tactical - 11th June 19

Market Oracle FREE Newsletter

Gold Price Trend Forecast Summer 2019

China and Rare Earth Metals Monopoly

Commodities / Metals & Mining Aug 11, 2011 - 03:12 PM GMT

By: OilPrice_Com

Commodities

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.

Source: http://oilprice.com/Metals/Commodities/China-and-Rare-Earths-Monopoly-for-Now.html

This article was written by Dr. John CK Daly for Oilprice.com who offer detailed analysis on Crude Oil, Geopolitics, Gold and most other commodities. They also provide free political and economic intelligence to help investors gain a greater understanding of world events and the impact they have on certain regions and sectors. Visit: http://www.oilprice.com

© 2011 Copyright OilPrice.com- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules