China Commences Rare Earth Exports (REE, AVL, MCP, SHZ, REMX)

The Ministry of Commerce said that China will continue rare earth exports and regulate export quotas according to World Trade Organization rules. The Xinhua News Agency reports that full-year quotas are currently under discussion. Late last year, China announced that it had reduced its rare earth exports to 14,446 metric tons, sparking new interest in stocks like Rare Element Resources Ltd. REE, Avalon Rare Metals Inc. AVL, China Shen Zhou Mining & Resources Inc. SHZ, Molycorp, Inc. MCP, and ETFs like Market Vector's Rare Earth ETF REMX. Last year, China exported 35,000 metric tons from January to November – up 14.5% from 2009. The United States, Japan and the European Union are the greatest recipients, accounting for 86% of total exports. Yao Jian, a spokesman with the Ministry of Commerce, said that it is normal for rare earth prices to fluctuate with demand and supply. China acted responsibly, he says, to ensure that the basic demand was met. Jian also said that China has noticed that Australia and the United States have begun to exploit rare earth supplies in their own countries. "This will effectively safeguard the global supply," he said. While China only holds around 36% of the world's rare earth reserves, it supplies 90% of the global demand.