China to Reduce Rare Earth Export

Chinese government issued second batch of export license for rare earth for 2011 to 26 companies with 15,738 tonnes. The total export quota is 30,184 tonnes for the year as 2010. However, the export volume could decrease from 2010 level when the government includes ferroalloy in the 2011 license.

The license in 2011 is 24% higher than 24,280 tonnes in 2010 while the government allowed around 6,000 tonnes of additional quota for foreign companies. Including the foreign companies’ license, total license in 2011 is 0.2% lower than 2010 level and near 40% lower than 2009 level.

The government included ferroalloy for second batch of license, which reduces actual export volume including ferroalloy. Japanese traders and magnet and alloy makers import rare earth in ferroalloy from China. High grade magnet for motor includes 25% neodymium, 69% iron, 1% boron and around 5% dysprosium. Japanese buyers’ rare earth procurement will get severer due to severer export control by Chinese government.