China raises annual rare earth output quotas to record high

A front loader shifts soil containing rare earth minerals to be loaded at a port in Lianyungang, in east China's Jiangsu province, for export. (AFP)
Updated 08 November 2019

China raises annual rare earth output quotas to record high

  • Annual quotas for 2019 are highest volumes ever allocated
  • Beijing had raised prospect of limiting supply in US trade row

BEIJING: China lifted its annual rare earth output quotas on Friday by 10% to record-high levels for 2019, potentially easing fears the world’s dominant producer of the group of 17 prized minerals will restrict supply.
Beijing in late May raised the prospect of weaponizing its control of rare earths, used in everything from consumer electronics to sophisticated military equipment, in its trade war with the United States but has yet to announce any formal restrictions.
China is home to at least 85% of global rare earth processing capacity, according to Adamas Intelligence.
The full-year rare earth mining quota has been set at 132,000 tons for 2019 and the smelting and separation quota at 127,000 tons, the Ministry of Industry and Information Technology said in a statement.
The quotas, up from 120,000 tons and 115,000 tons, respectively, in 2018, are the “highest volume ever allocated” David Merriman, a London-based manager at commodity research firm Roskill, said in an email.
China has now increased the allowances for two years in a row and an official at the Association of China Rare Earth Industry confirmed the numbers were record highs.
They imply a quota of 72,000 tons for mining in the second half of 2019, up more than 54% from an unusually low level a year earlier.
For smelting and separation, or the processing of ore into material manufacturers can use, the second half quota is 69,500 tons.
The quota hikes could be seen as a message that China has “the capability to increase supply, making life difficult for (rare earths) under development in regions such as the Americas, EU and Australia,” Roskill’s Merriman said.
But it likely “has much more to do with the domestic Chinese supply-chain situation,” he added, noting that China had been increasingly looking overseas for feedstock amid an environmental crackdown at home.
The move will allow state-run miners and processors to “legally maintain market share,” Merriman said.
China typically issues the rare earth quotas twice a year for six-month periods. In March, the first-half quotas were set at 60,000 tons for mining and 57,500 tons for smelting and separation.
The late release of the full-year quotas comes as Beijing and Washington work to iron out the details on a so-called “phase one” deal to end trade hostilities.
China’s rare earth exports in October rose by 1.9% from the previous month to 3,639 tons, according to customs data released earlier on Friday.


Lebanon plunged into ‘deliberate depression’: World Bank

Updated 01 December 2020

Lebanon plunged into ‘deliberate depression’: World Bank

  • The fall 2020 edition of the Lebanon Economic Monitor predicted the economy will have contracted by 19.2 percent this year
  • Lebanon’s economy started collapsing last year as a result of years of corrupt practices and mismanagement

BEIRUT: Lebanon’s economy is sinking into a “deliberate depression,” the World Bank said Tuesday in a damning report stressing the authorities’ failure to tackle the crisis.
The fall 2020 edition of the Lebanon Economic Monitor predicted the economy will have contracted by 19.2 percent this year and projected a debt-to-GDP ratio of 194 percent next year.
“A year into Lebanon’s severe economic crisis, deliberate lack of effective policy action by authorities has subjected the economy to an arduous and prolonged depression,” a World Bank statement said.
Lebanon’s economy started collapsing last year as a result of years of corrupt practices and mismanagement.
The crisis was made worse by a nationwide wave of anti-government protests that paralyzed the country late last year and the Covid-19 pandemic this year.
The August 4 Beirut port blast, one of the largest non-nuclear explosions in history, brought the country to its knees and further fueled public distrust.
“Lebanon is suffering from a dangerous depletion of resources, including human capital, with brain drain becoming an increasingly desperate option,” the World Bank warned.
In 2020, Lebanon defaulted on its debt, banks imposed capital controls and inflation has reached triple-digit rates, dragging the country into its worst ever economic crisis.
Instead of taking emergency measures to rescue the economy, Lebanon’s political elite has continued to dither and bicker.
The previous government headed by Hassan Diab failed to adopt ambitious policies to tackle the crisis. It resigned under pressure over the blast nearly four months ago and a new cabinet has yet to be formed.
“Lack of political consensus on national priorities severely impedes Lebanon’s ability to implement long-term and visionary development policies,” said Saroj Kumar Jha, World Bank regional director.
He called for the quick formation of a new government capable of implementing short-term emergency measures and addressing long-term structural challenges.
“This is imperative to restore the confidence of the people of Lebanon,” he said.
An annual index compiled by Gallup that tracks people’s experience of stress and sadness said “no other country in the world saw negative experiences skyrocket across the board as much as Lebanon.”
The Negative Experience Index’s data was collected before the Beirut port blast, Lebanon’s worst ever peace time disaster.