Commerce Resources Corp (CCE)

[sumisu]

Market cornered for rare minerals

Monday, November 16, 2009

http://www.thestandard.com.hk/news_detail.asp?we_cat=3&art_id=90569&sid=26103708&con_type=1&d_str=20091116&fc=10

As resource-hungry China scours the world for crude oil and natural gas supplies, it has managed to corner the global market for a group of obscure metals used to make iPods, wind farms and electric cars.

The mainland supplies at least 95 percent of the world's rare earths - 17 chemical elements with names such as praseodymium and yttrium - essential for a wide range of high-tech devices and green technologies.

China, which has long recognized the value of these metals, is tightly controlling the supply of these vital natural resources.

"China's goal is to create jobs in China and create goods in China," said Jack Lifton, a US- based independent rare earths analyst.

"We need to start producing these metals [in the United States] as we did in the past. If we don't do that, China will be the only country manufacturing devices using rare earths by the year 2015."

A single mine in the country's north produces half of the world's rare earths, with the rest coming from smaller mines in southern China as well as Russia, India and Brazil. China keeps most of the minerals within its borders by restricting foreign shipments.

Authorities have been increasingly restricting exports in recent years to prop up prices, ensure supply for its own needs and create jobs for millions of migrant workers by luring foreign companies to its shores.

Alarm bells started ringing this year amid reports that the State Council was considering further tightening restrictions and even banning the export of certain elements as well as closing mines.

Foreign companies and governments fear the new rules, if implemented, will deny them access to the metals used to make everything from hybrid vehicles to missiles, and force manufacturers to shift their plants to China.

Deposits being developed elsewhere will make available about 50,000 tonnes of rare earths by 2014. But total demand is expected to double to around 180,000 tonnes within five years. AGENCE FRANCE-PRESSE