“We must pursue upstream-downstream linkages between the enterprises involved in the mining, production, circulation, import and export of the rare earth metals industrial sectors. We must address both the symptoms and root causes to resolve the problem of rare earth resources developments…” the State Council’s joint investigation panel of the rare earth industry said during a meeting held on December 14, 2012. The message suggests that China will continue to strengthen supervision over the rare earths industry in 2013.
Part ⅡProspects for China’s 2013 rare earth industry policies and measures
In 2012, the Chinese government has formulated and adopted a series of policies and measures for the rare earths sector that will no doubt be further developed and put into practice in 2013. Some of the important policies and measures are:
▲ The “Rare Earth Industry Access Conditions”, the ”Provisional Measures on the Indicative Production Plan for Rare Earths” and the policies of merger and reorganization will continue in order to address over-capacity in smelting and separating.
▲ The Ministry of Industry and Information Technology (MIIT) will introduce a plan to implement and establish state-level and large-scale rare earth conglomerates in 2013. China North Rare Earths (Group) Hi-tech Co. will be led by the Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co. (IMBREHT) to integrate light rare earth resources in the country’s northern region. Two or three state-level and large heavy rare earth groups also will be established in the country’s southern region. Among these, China South Heavy Rare Earths (Group) will be established in Ganzou, Jiangxi province and probably led by China Minmetals Corporation (CMC), Rare Earth Group and Ganzhou Rare Earth Group with another from the China South Heavy Rare Earths (Group) to be established in Guangdong province, I guess that it will be led by China Nonferrous Metal Mining Group (CNMC) Rare Earth Group with the likely leadership of China Iron & Steel Research Institute Group (CISRI), Guangdong Rare Earth Group and Yunnan Rare Earth Group.
▲ The REE trading platform will be opened in 2013. The exchange will be a way of giving more “transparency, visibility and consistency” to the rare earth market. Moreover, it is worthwhile to note that the China Securities Regulatory Commission (CSRC) has started to investigating the viability of setting up a rare metals futures trading center in Ganzhou, Jiangxi province, probably to be operated by both of China’s trading platforms.
▲ The joint supervision system for the exploitation of industrial rare earths aims to curb illegal rare earth mining, producing, trading and smuggling. I think that the government will continue to crack down on illegal enterprises with strength and determination to close the supervision loopholes, using stricter regulatory measures, resulting in a likely increase in rare earth prices.
▲ China’s relevant departments are studying the potential to include rare earths into the scope of ad valorem tax so as to lift the tax rate, aiming to protect rare earth resources by way of a tax increase. So the new tax policy on rare earth resources could be released by the Chinese government in 2013.
▲ The Chinese government will continue to actively promote an international rare earth strategy in accordance with established State Council guidelines. In principle, the technical exchange will be the focal point of the government’s international cooperation plans, given that it will become the main area of foreign policy in the future. I think that the Governmetn will outline the new international strategy for rare earths in 2013. In addition, China will encourage competitive rare earth enterprises to “go global” by investing abroad.
Overall, it appears that in 2013, China’s unilateral rare earth supply pattern will be replaced by a multilateral supply one for the global market, especially in the light rare earth sectors. Meanwhile, as for the WTO rare earths trade dispute, which should affect the formation of some China’s rare earth policies, Sino-Japan relations are deteriorating over control of the Diaoyu Islands, adding uncertainty and affecting the global rare earth market.
Hongpo
Yes, China is actively promoting an international Rare Earth Policy.
It is in the best interest of China to do so.
Of course….it wants to keep its competitive advantage.
Too bad that some of the West missed the wake up call.
The ROW should spend more time developing their own
National Strategies instead of bashing China who
is an expert at side stepping opposition.
I consider the WTO China farce an exercise in whimpering.
The WTO,in my opinion,has replaced its mission statement with
Geopolitics.
As an American Citizen I am embarrased by our lack of
Governmental leadership.
In my travels I try to avoid conversations with foreign friends about the State of our Nation.
CNN is broadcast and watched in many Nations…watching
our recent cartoon about the fiscal cliff has many Foreign Government Officials shaking their heads…thoughts are crossing
their minds…do we want to engage in Diplomatic Agreements or
Corporate Arrangements with people who can not get their own
House in order but consistently try to tell other Countries how to run their Government.
Below is my last word of the year that I sent to my friends.
Subject: Fiscal Cliff….My year end venting
If you spend more than you make then what is the solution?
If you derive the majority of you revenue from taxing your citizens then how do you pump up your revenue?
If you tax 100% of your citizen’s income and continually borrow from foreign governments and the money generated is still not enough to pay your bills then…..WHAT IS THE SOLUTION…..where is America headed?
All of the above is bad news…However,there “is” a solution.
GOVERNMENT NEEDS TO SUPPORT NATION BUILDING.
We need to exploit and develop our natural resources like
Natural Gas and High Technology…Support/encourage the NG projects and open up Federal land to exploration.
If we get our Nat Gas industry up and running and we will be able to repatriate some of our US manufacturers and import industries related to chemical/fertilizers, etc… due to our low energy costs.
It will generate Billions of revenue for the Government from
Corporate Taxes,Licenses,etc.
We need to protect our high tech technology like we did under the Reagan administration.
We need to go back to the concepts developed by the Defense Intelligence Agency(Project Socrates) to regain our Economic Dominance. Support/Protect our Technology Industries instead of allowing Greedy Politicians to allow technology transfers to Foreign Nations many of which end up using it in their military applications which can be used against us.We need to support/develop our rare earth and critical metals industries so the high tech products can be produced in the US at competitive costs.
We need to protect and capitalize those industries which we have “Competitive Advantage”.
We especially need… less Government Regulation and more Free Market Capitalism to succeed.
For those that think that this is the United States of the past and that our Government has basically remained the same as it was 10 years ago. Well, I think that you may be in for a rude awakening in the future.
Just a few of the changes in the past few years include but not limited to:
Massive loss of freedoms,privacy,and legal remedies which are too numerous to list here.
You need to do your own research. Start with the constant/continual loss of legislative and judicial powers that been quietly given over to “Executive Order”. You should give that some considerable thought as to what that means to a Government System that was implemented by our Forefathers so as to protect the “Republic” and to maintain a “Democratic Way of Life” rather than allowing Totalitarian Influences,which do not act in the best interest of the populus,to weasel their way into power.
In my laymans opinion, as a concerned citizen, the next two events that will indicate whether we are into Nation Building or Ideological Building will be the following.
1./ Will the Legislative Processes be overriden by “Executive Order” on the 2nd Amendment rights?(Right to Bear Arms)
2./ Will our leader allow us to go over the fiscal cliff in order to bash the other political party in a “State of the Union Address” and move forward with an agenda of a One Party Nation?
(Democrats or whatever the new name of the party will be)
Let us all hope for the best.
However,let us keep our eyes open and our ears to the ground.
Complacency is not an option.
“You do not need a weatherman to see which way the wind blows.”
Happy New Year to All
Economic Dilemma
http://www.heritage.org/research/reports/2012/10/federal-spending-by-the-numbers-2012?roi=echo3-14101048222
Project Socrates
http://shelf3d.com/i/Project%20Socrates
Biggest 2012/2013 story in REE is Chinese Government takeover of China’s REEs with central Control and Pricing.
Why not?
Kind regards,
If there continue to be a world shortage, why are prices tanking along with the share prices of all those western firms at the forefront in the industry?
Prices are tanking because the pricing scoreboards for REE are based in China. The relationship between China and Japan are at an all time low with the fight over the Diaoyu/Senkaku islands, China stop buying Japanese Products and the Japanese retaliate by not buying any REEs from China THUS the price is falling which DOES NOT reflect real true pricing of Rare Earth. Japan is waiting for LYNAS to come online and do business with them THUS real demand will appear with Reliable and Consistent suppliers and the REE price will jump up.
aurelius,
very good question and one I have given a lot of consideration to over the past few months
I have come to the conclusion that rare earth prices continue to tank because illegal exports of rare earths out of China continue to flourish, that is rare earths are being smuggled out of China and being sold to the West on the black market
Given the reported supply / demand imbalance, and all of last years Chinese rare earth export quota not being taken up – then it’s reasonable to assume the demand in the West is being satisfied from somewhere – where else but from the Chinese black market
Perhaps it’s in the interest of the Chinese Government to permit the smuggling of rare earths out of China at this time – think about that !
If demand is being satisfied there will be less urgency to bring new producers online and hence fewer new rare earth producers setting up in the West. Also with rare earth prices continuing to decline it makes it much harder for Western exploration companies to justify the economics of bringing their projects into production.
From here I believe only new projects with outstanding economics will ever make it into production, they must be cost effective in terms of required Capex and ongoing operating costs as well as have outstanding high grade heavy rare earths.
Do you know of any company demonstrating these competitive advantages !
“Do you know of any company demonstrating these competitive advantages ?”
Yes 1 company. Lynas
The share price are tanking because there is NO TRANSPARANCY of prices ONLY what China displays and Japan which buy 80% of world supply REFUSES to deal with China. They HATE China. They raped the chinese villages in WW2 and REFUSE to apologize for it. The trader have no real pricing to go by except WHAT china displays. China prices falling because their arch enemy dont want their REES. They are consuming their own stock piles until Lynas comes on board.
crosland and hastings will succed