The China government may slash export quotas of rare earth mineral by half in 2011, according to China Securities Journal, after Beijing raised international concern by cutting exports of the minerals next year.
Market anticipation of China rare earth quotas is not accurate. If we account according to the statistics in 2010, the exports quotas might be slashed by half. Unfortunately, the Ministry of Finance currently do not define the gross quotas for 2011, and the second round of quotas may not be publicly announced anyway, the Journal quoted a source as saying in the report.
The 16,304 ton quota from 2010 doesn't include exports by foreign companies while the 14,446 ton quota for next year does include shipments by foreign companies. It didn't give figures showing a decline of about half in the first round rare earth quotas, the source added in the report.
Earlier this week, China's Ministry of Commerce issued the first batch of 2011 rare earth export quotas and allotted 14,446 tonnes of quotas to 31 companies, compared to the 16,304 tonnes allocated 22 companies in the first batch a year ago.
China suspended shipments of the mineral to EU and US in October, media reports stated. The suspension came after there were indications that the U.S. would investigate if China was violating World Trade Organization rules by subsidizing clean energy exports and limiting clean energy imports.
China has been reducing export quotas of rare earth minerals for the past few years, citing environmental concerns. However, Wang Caifeng, who is in charge of setting up the China Rare Earth Industry Association, stated that China might slightly raise the production cap and export quota next year.
China, which mines more than 90 percent of the world's rare earth, has exported 6,000 tones, or 49.8 percent, of its total rare earth to Japan, representing 167 percent rise year on year, according to China's Ministry of Commerce.