China Says Other Countries Should Exploit Rare Earths

Bloomberg--China said its restrictions on rare- earth exports protect the environment, are in compliance with its World Trade Organization commitments, and that other countries should step up their exploitation of the minerals after it cut its 2011 export quotas.

“International markets will have increasing needs for rare earths,” Foreign Ministry spokeswoman Jiang Yu told reporters in Beijing today. “Other countries with rare earth resources should also develop and exploit their resources and jointly shoulder the responsibility for rare earth supply.”

Jiang’s comments come after China this week announced an allotment of rare earth export quotas for 2011 that were 35 percent lower than a similar round earlier this year and after the U.S. said last week that it may take action against China in the WTO over its rare earth export policy.

China, which accounts for more than 90 percent of world supplies, slashed export quotas for rare earths by 72 percent in the second half of this year, leading to a surge in prices and announcements by mining companies in the U.S. and Australia that they would begin production over the next several years. Japan, the world’s biggest user, has sought alternate supplies for the minerals, which are needed for smartphones, hybrid cars and guided missiles.

Jiang said China’s rare earth policy was “in line” with its WTO commitments, said China was looking for new rare earth supplies and encouraged foreign countries “with sophisticated technologies” to help China better exploit its rare earth resources.

--Michael Forsythe. Editors: Patrick Harrington, Mark Williams