China’s rare earths quotas go

MELBOURNE: China’s move to scrap export quotas on rare earths, crucial in most modern technology, may not mean an end to the uncertainty over supplies because the top producer can still find ways to control shipments and influence prices, industry players said.
China, which supplies about 90 percent of the world’s rare earths needs, imposed export restrictions and raised tariffs in 2010 as it sought higher prices to help cover the huge environmental costs of production and tried to encourage the growth of domestic industries that use rare earths.
Prices shot up as buyers scrambled to secure supplies, leading Japan, Europe and the United States to file a trade complaint. The World Trade Organization ruled last year that China’s restrictions were discriminatory and told it to scrap the quotas and export tariffs. In response, Beijing announced in late December it was ending the quotas.
However, that is not expected to affect supply or prices, as China has not filled its export quotas over the past three years anyway, analysts and the world’s only non-Chinese producers of rare earths, Australia’s Lynas Corp and US firm Molycorp, said on Wednesday.