Government and Policy

Govt cracks whip on rare earth mining

By Wang Qian (China Daily)
Updated: 2010-05-21 07:46

Beijing - China will launch a five-month nationwide crackdown on illegal mining of rare earth starting next month in a major bid to protect its valuable resources.

Wang Min, vice-minister of land and resources, said at a video conference on Thursday that the ministry will set up a long-term supervision system to better regulate the rare earth mining market.

Related readings:  What's the rare earth war all about?  2 Mongolians detained for smuggling snow leopard pelts in China  China mulls plans to curb rare earth smuggling

Precious metal mines like rare earth, tungsten, antimony, alumina clay and fluorite will all be targeted in the campaign, Wang said.

"The campaign aims to clamp down on illegal mining activities like mining without licenses, over exploration and environmental damage," he said.

Rare earth, which includes minerals such as dysprosium, terbium, thulium, lutetium and yttrium, is widely used in sophisticated fields of science and technology, like electronics, aviation, atomic energy and mechanical manufacturing.

China supplies 93 percent of the global production of rare earth elements.

Besides the crackdown, every mining area will gradually have a supervisor under the local land and resources bureau whose name and telephone will be open to the public to prevent illegal exploration.

The ministry will ban the mining or detecting of metal resources and hand down punishments to violators, Wang said.

Officials said the rising prices of rare earth have promoted illegal mining activities in the country.

The crackdown will have a bigger impact on the mining industry in South China than in the north, because the mines in the south, which contribute about a third of the country's rare earth ore, are small and hard to find, especially in Sichuan, Jiangxi, Guangdong and Fujian, said Wang Huachun, an analyst of the nonferrous metals industry with Rising Securities.

China has little say on international pricing due to inadequate industrial innovation and slow development of high-end products.

The country, however, has been taking a slew of measures to stabilize rare earth pricing in the international market by tightening production and exports.

On March 15, the Ministry of Land and Resources said in an announcement that it will suspend the applications for tungsten ore, antimony ore and rare earth exploration and mining until June 30.

The China Business News Agency reported earlier that at a seminar on the State's strategic reservation of mineral lands organized by the land and resources ministry in mid-May, experts said the first group of mineral land reserves will be launched, but whether to store concentrates or products is still under discussion.

China reduced its export quotas for raw rare earth elements from 2005 to 2009.

The Ministry of Industry and Information Technology said last May that China will trim 2009 output quotas of rare earth by 8.1 percent from the previous year to 119,500 tons, the fifth straight year it imposed such a cut.

Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Corp, one of the country's major rare earth producers, said in April that its 2009 net profit declined nearly 70 percent from the previous year, hitting 55.8 million yuan ($ 8.2 million).