Despite early reports to the contrary, China will not ban exports of rare earth metals, the New York Times reports.
Instead, China will just virtually ban them:
A copy of the draft rules, viewed Thursday, said China would further reduce its combined annual export quotas for all rare-earth elements to 35,000 tons a year, from 53,000 tons last year and almost 66,000 tons as recently as 2005.
The draft policy also clearly stated that exports of dysprosium and terbium were to be prohibited along with exports of three other rare-earth elements: thulium, lutetium and yttrium. But Ms. Wang seemed to back away from that.
By cutting exports, as well as putting a total tax of 42 per cent on exports of dysprosium, terbium and some of the other rare-earth elements, Beijing officials have successfully required manufacturers of advanced magnets, motors and other technologies to move their factories to China, where the minerals are readily available.
China has a tight grip on the world’s rare earth metal supply, mining around 93% of those metals. Of the rare earth metals, it has almost exclusive domain over dysprosium and terbium, which are used in magnets. The rare earth metals are necessary for many greener technologies, like hybrid cars and wind turbines.
This is a relatively obscure issue, but it appears as though it could be the start of a big round of WTO negotiations with China and the rest of the world, in particular, Japan.
Shares of Avalon Rare Metals of Toronto (AVL.TO) have climbed because everytime this story is brought up the company is mentioned. It is currently developing mining operations for rare earth metals in Canada.
NOW WATCH: Briefing videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.