New China Rare-Earths Group will become world’s second-largest rare earths producer
December 31, 2021
In an effort to strengthen its rare earth element production, the China Rare-Earths Group has formed from the rare earth segments of government owned China Minmetals Corp, Aluminium Corp of China, and Ganzhou Rare Earth Group Co. Chinese state broadcaster CCTV reported that this conglomerate is intended to allow for the better allocation of resources, greener development and hastening mine development in southern China.
Based on issued quotas for the first half 2021, the merged company is in line to be the world’s second-largest rare earths producer – in terms of output – after China Northern Rare Earth Group, accounting for around 70% of the country’s heavy rare earths production.
Patricia Mohr, independent economist, told The Northern Miner, “The merged company will increase the control over prices in the international market place and could lead to even higher prices in the coming year.”
As an example, Mohr noted that the price of neodymium oxide (99% China FOB), for instance, hit $142,300 per tonne on December 8, a 79% year-on-year increase, and the highest level since May 2012. In mid December, terbium oxide (99.9% FOB China) reached $1,730 per kilogram (up 68% from 2020), while dysprosium oxide (99% FOB China) has reached $456 per kilogram (up 57% year-on-year).
“It’s great for the business in the sense that I think the West is increasingly realising that there needs to be an integrated localised supply chain,” Jim Litinsky, CEO of MP Materials, told Bloomberg. MP Materials is noted as the only US producer of rare earths.