China’s Five-year plan for the rare earths industry

 I sum based on Xinhua report:

Problems now:

1. illegal mining; production capacity expland too rapidly; 2. damage to environment and waste of resources; 3. high-end development and research lag behind; 4. disorder in export

Solutions: 

1.    improve technology in exploration, distill, and application2.    “Insist” on : environment protection and energy saving; control total output and optimize reserves; coordinate national and international market and resources

Goal: a rare earths industry with resonable exploration, orderly production and advanced technology in five years

How:

1.    more regulation on total output, export quota, environment standards

2.    legal moves against illegal mining and damage to environment

3.    coordinate the industry, merger and acquisition

4.    research and develop technology

The original report is here: 温家宝主持国务院常务会：五年形成稀土业持续健康发展格局

Commerce minister: China and Japan develop rare earths together

China would like to work with Japan to research on rare earth alternatives, said Chen Deming, the commerce minister, at a press conference in Beijing.

Rear earths resources under earth are very limited, and they will soon be used up under current rate of exploration, he said. “We have to look for recycling methods and alternative resources. We would like to work together with other countries,” Chen said.

China has decided to restrict both the exports and domestic use of rare earth due to environmental concerns, he said.

Chen said the rare earths resources in the country is mainly in the least developed regions. Its technology in exploring and processing rare earth is not advanced enough, leading to bad impact to the environment.

Chen said he lived in Jiangxi, a province with rich rare earths reserves, for more than 10 years, and he noticed the damage to the environment himself. “Large area of land cannot be recovered after rare earths exploration, and that influenced the ecology greatly,” he said.

The transcribe of the press conference is here: 陈德铭两会http://www.gov.cn/2011lh/zhibo/20110307a.htm

a month without rare earth

experienced:

村上春树：《海边的卡夫卡》
王小波：《我的精神家园》
沈从文：《从文自传》
鲁迅：《彷徨》《呐喊》《故事新编》
林语堂： 《苏东坡传》
吴敬梓：《儒林外史》（favourite）
刘义庆：《世说新语》
Yukio Mishima: Spring Snow, Runaway Horses, The Temple of Dawn, The Decay of Angel

Wolfgang Mozart: Magic Flute
Franz Schubert:  Piano Sonata in C minor, D958; Piano Sonata in A, D959; and Piano Sonata in B flat, D960

Some data on rare earth trade between China and Japan

Japan imported 4,080 tons of rare earth from China in December, up from 634 tons in Novemver, according to the Japanese Ministry of Finance.

That accounts to 86 percent of China’s total export in the month, which stands at 4,738 tons.

In total, Japan imported 23,310 tons of rare earth in China in 2010, or 82 percent of its total import volume, which is 28,564 tons.

It also means about 60 percent of China’s exports of the minerals go to Japan in 2010, which is 39, 813 tons in total, according to data from China Customs Statistics Information.

Germany working with Kazakhstan on rare earth deals

German companies are working with its government to develop rare earth projects in Kazakhstan, the Bloomberg cited the Handelsblatt newspaper as saying.

The report said BDI, or Federation of German Industries, had began enlisting companies since late 2010. These companies might take direct stakes in rare-earth development projects abroad, it said. 

The cooperation between Kazakhstan and Germany is similar with that of Mongolia and Japan. In both cases, the poor country is eager to develop its natural resources in exchange for development help and technology know-how. The rich country needs raw materials outside China. 

Here is the Bloomberg story: Germany, Kazakhstan Forging Rare-Earth Pact, Handelsblatt Says

Top hedge fund manager attributes success to rare earth stocks

Canada’s best performing hedge fund manager of the past year won big by positioning on rare earth stocks, according to a story on the Global and Mail.

Steven Palmer, president of Toronto-based AlphaNorth Asset Management Inc, said his company positioned with their biggest weighting in a couple of rare earth stocks such as Stans Energy Corp and Ucore Rare Metals Inc, and they were the star performers.

“The rare-earth stocks were among the winners that helped his fund become the top-performing Canadian hedge fund last year, ” the story said, citing data compiled by Globe Investor.

Palmer prediced that resoruces would have a pullback this year. “By the end of this year, resource stocks will be flat to modestly higher, but returns won’t be as good as we experienced in 2010,” he was quoted as saying. 

Here is the story: 

 Top hedge fund manager turns to tech micro-caps

China’s rare earth strategy criticized at home

        The West might see China’s handling of rare earth as too aggressive. At home, however, the policy is been criticized as being too introvert and passive. 

        An article on the website of the Ministry of Land and Resources started by a dialogue:

        A: Do you know that the Japanese has started to explore rare earth resources in Mongolia, Vietnam and Australia?
        B: That is good. So that they will not over develop the rear earth mines at home. Anyway we have enough for ourselves.
        A: You did not get what I mean. Being the largest producer and consumer of rare earth in the world, with mature geological exploration resources, why don’t we explore rare earth mines around the world, so that we can control it the way the Brazilians and Australians control the global iron ores?

        The article then said China did not try to control global rare earth resources. Instead, the country is used to take the defensive position, even in terms of rare earth, for which it actually has a dominant position.

        The thesis, the article said, is that in the global capital market, the control of resources does not lie on the control of materials or trading channels, it is the capital control of end supply and demand market.

       China’s performance in rare earth resources, according to the piece,  did not break through the status quo of being a resource supplier from the third world. It says that even China controls 70 percent of the world’s rare earth resources, it will not be able to monopolize the market as countries with transnational companies do, such as Brazil (Vale), Australia (Rio Tinto and BHP Billiton)

      The United States, it says, take an opposite strategy: “The US let its own oil sleep on the land of America, and reach its capital all over the world.”

      It ends by concluding that the resource strategy is still too introvert. It does not has the strategy of “managing the earth,” the author cited Mao as saying.

      Here is the article:"We are lacking capital and right thinking"