Blog PostRare Earth Element Stocks (REE) - China's Clever Crimp to the World of Rare Earth Oxides

China has made another clever move in its export restriction of rare earth elements. 

Recently the European Union, United States and Mexico complained to the World Trade Organization about China's raw materials export policies. The WTO resolved the issue in favour of the complainants.

China answered back in a clever manner: their export cap will now include ferro-alloys containing more than 10% rare earths

They made this change while leaving total export quotas unchanged. This action will indirectly lead to a significant reduction in the volume of rare earth oxides leaving China. The immediate net effect is a 20% reduction. Worries are that this could raise to 40% in 2012.

According to reports, the ferro's most effected:

     -  dysprosium
     -  neodymium
     -  cerium
     -  silicon

While more than 30 companies are licensed to export rare earth ferro-alloys, China National Nonferrous Metals and Jia He Hui Cheng Trading make up 45% of the total volume.  The largest importer is Japan who took over 38% of the rare earth ferro-alloys. 