China Eyes 20% Export Cut for Rare Earth in 2008

Chinese government could reduce export license of rare earth by 20% for 2008 as a part of the policy to limit minerals like termination of valued added tax return, ban of processing deal trade and export tariff. The country reduces the export volume gradually and reduced to around 43,000 tonnes for 2006 from 50,000 tonnes in 2005. The additional reduction could tighten the world supply and lift the international price under growing demand for electronic materials. The country reduced the export license volume of tungsten, for which China represents 90% of world supply, to 15,400 tonnes for 2007 compared with 16,300 tonnes in 2005. China also reduced the license of antimony, for which China represents 85% of world supply, to 61,800 tonnes for 2007 compared with 65,700 tonnes in 2005. For rare earth, for which China represents near 95% of world supply, the country is expected to reduce the export by 14% compared with 2005. With 20% reduction, the export could decrease to around 35,000 tonnes in 2008. Chinese limit for rare metals lifted the international market. Neodymium indication price hit near FOB US$ 40 per kilogram for Chinese oxide products temporally compared with averaged US$ 7.26 in 2005. The price decreased to around US$ 28 but the price could surge when China would reduce the export.