China To Cut Rare Earth Production

China is to reduce production quotas of rare earths and will stop issuing exploring licences for rare earths, tungsten and antimony until 30 June 2010, the Ministry of Land and Resources said in an document issued yesterday.

In an effort to boost proces, the quota for rare earth production has been reduced by 6 percent. However quotas for tungsten were increased 2.6 percent and antimony by 23 percent.

Many miners recently stopped operations when prices dropped sharply as a result of the global financial crisis.

China has over half of the world’s deposits of rare earths, tungsten and antimony and over 80 percent of production. Late-former leader Deng Xiaoping once said: "The Middle East has oil, China has rare earths".

Last week, China Non-Ferrous Metal Mining became the majority shareholder in Austrlian rare earths miner Lynus Corp (LYC). While, in March, East China Exploration bought a 25 percent stake in Austrlia's other big rare earths prodcuer, Arafura Resources (ARU).

Source: Proactive Investors