Molycorp.Inc. (fka MCPIQ)

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Chinese rare earth deep processing of Shame: 10 yuan to sell more than 1,000 yuan to buy back
2014-4-3 16:05

iheartweimers, The translation software doesn't always give you the best read, in fact sometimes its a painful read. Hear is a good example of how the Chinese feel about us buying their cheep REO's and selling them back value add products. This is why I see prices escalating for their raw oxides once they've finished dumping their excess on the world market. Once they complete their mining consolidation and reduce excess inventory, prices will head north. There never was a supply problem and we've never reached their export quotas anyway. It has been a bad joke played on the West since the beginning. I think the spot market pricing they are trying to set up is mostly to placate the western counties and within China domestic business will still enjoy some sort of discount or tax incentive. Currently businesses within China enjoy about a 40% discount on raw materials, so there is a bit of an unfair advantage within their boarders. Its still a wait and see, we all know they aren't going to do the West any favors, why would they.

Abstract: China supply more than 90 percent of the world's rare earth resources, but because there is no obtain rare earth pricing, selling resources into "cabbage price." This imbalance, so that our country faced up to the regulation of rare earth industry. Implementation of rare earth quota system is based on the consideration of the protection of the environment and resources in the export sector real ...


[1 dollar of rare earth materials, we roughing up to sell 10 yuan, 20 yuan, to the U.S. and Europe made product, we will spend 1,000 yuan to buy back]
China supplies more than 90 percent of the world's rare earth resources, but because there is no obtain rare earth pricing, selling resources into "cabbage price."
This imbalance, so that our country faced up to the regulation of rare earth industry. Implementation of rare earth quota system is based on the protection of the environment and resource considerations, a control implemented in the export sector.
Antaike rare earth market research analyst Chen Huan analysis, said the elimination of export management measures will not have much impact on China's rare earth industry itself, the real impact will be China's rare earth deep processing and application aspects.
Minmetals Group Assistant President Mr Wang's remarks earlier interview, revealed the rare earth industry in the short-board processing areas: one dollar of rare earth materials, we roughing up to sell 10 yuan, 20 yuan, to the European and American made products, we have spent 1,000 yuan to buy it back.
April 2 Inner Mongolia, a rare corporate executives told reporters, "Our way is not that rare earth industry consolidation, but how deep into the rough machining."
At present, China's rare earth raw materials and processing industry remained roughly three bases and two north-south pattern of production systems, with the implementation of national policy, there is a further focus on the trend. However, according to the Ministry of Industrial Research Institute CCID director???materials research, the three main bases for the production base, its main products are mostly raw and rough in the primary stage of product development and other downstream applications that slow development.
In NdFeB, for example, it is divided into two kinds of NdFeB sintered NdFeB and bonded. Wherein the bonded magnets are neodymium NdFeB alloy powder, epoxy resin, plastic and other additives, such mixed binder, using a molding method such as compression molding, calender molding, injection molding and is prepared made of composite permanent magnet.
Galaxy magnet there had projects, namely through the use of bonded NdFeB magnets, praseodymium, neodymium alloy available annually about 1,200 tons, can greatly reduce the cost of electricity. However, due to the volatility of rare earth price "roller coaster" type, have a significant impact on the bonded NdFeB industry, this project also because the user can not accept early mortality.
"In the rare earth prices skyrocketing, even as selling products directly selling resources." Aforementioned corporate executives say, by the influence of rare earth spike, rare earth downstream processing sectors hard hit.
In the interview with this reporter in the eyes of many industry people, China's rare earth deep processing level varies greatly, NdFeB industry is in a leading position in many respects, but in rare profits, driven by continued expansion of raw commodities sectors, relative but a sharp decline in downstream applications. "Not only is the fight of faith, as well as reputation, up to now no fully recovered."
Another rare earth deep processing of distress "bothering" is caused by a duplication of serious excess capacity.
???said that although China's rare earth permanent magnet production ranked first in the world, but the market share of high-performance permanent magnet materials is less than 10%. Many provinces, even without the resources and core technology, the new project is still a lot of construction NdFeB, resulting in a more serious homogenization phenomenon vicious competition.
"We hey some companies are a division of labor, and now every place in the enclosure, do engage in NdFeB Rare Earth Zone, a dozen things turn out two million tons, which is the largest repeated construction waste." Had the rare earths Enterprise People who said to the reporter.
In fact, there is not just part of the rare earth separation overcapacity, luminescent materials, there are also a lot of excess capacity. Among them, the 2011 rare earth luminescent materials production capacity of 6,000 tons, but after only a year on more than 20,000 tons of production capacity, a lot of new capacity projects are launched from 4,000 tons.
Reporter access to "1 +5" program in six business groups, are all involved in the deep processing field. In Xiamen Tungsten , for example, since 2006 the company entered the rare earth industry, focusing on the development of rare earth deep processing industry, now has 5,000 tons of hydrogen storage alloy powder project, 1,000 tons phosphor projects.
In addition, has made it clear to fade upstream control of Rare-Earth future development strategy is also focused on the development of rare earth materials applications, expanding the scope of application of rare earth materials in the field of high-end, application of technology to enhance the level of rare earth, rare earth products to increase the added value. Baogang Group even promised to support the focus on the development of rare earth smelting Baotou Steel Rare Earth, separation, materials and applications, Baotou Steel Rare-Earth Group for the rare earth smelting, separation and integration party applications business.
The real problem is that the current domestic rare earth processing enterprises concentrated in NdFeB, luminescent materials and NiMH batteries three industries, high-tech industries rarely dabbled in other applications. Rare earth deep processing of ICBC homogenization of the industry, has seriously hampered the development of rare-earth applications.
"China's rare earth industry chain is very short, the real high value-added chain is the end product, but all these years we still sell primary products of rare earth, which in turn also to thousands of times the price to buy from abroad deep processing products. "preceding business people said.
He believes the key to the rare earth deep-processing industry is to look at the application side, the current application link is not up for three main reasons: First, alternative materials for the market to seize the high-end market is difficult technical issues, then there are sluggish exports, domestic consumption has always been short board; also lanthanum magnesium nickel-hydrogen storage battery domestic industrial enterprises there are problems.

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