Experts urge sustainablity in rare earth industry

During a recent industry summit, a few experts argued that China's rare earth industry should give up the price war, encourage technological innovation and strive for the sustainable development of the industry.

China's rare earth reserves account for about 30 percent of the world's total, while the country's output supplies 95 percent of the global demand, marking a severe imbalance.

According to data from the Ministry of Land and Resources, China's aggregate proven rare earth oxide reserves amount to about 83 million tons. Experts, including Lin Donglu, secretary general of the Chinese Society of Rare Earths (CSRE), said that the amount of unexploited rare earth reserves in China is estimated to be less than 30 percent of the world's total, far lower than generally believed.

If it is calculated in terms of per capita rare earth reserves, China would be a country with relatively scarce rare earth resources.

Zhao Zengqi, president of the Baotou Rare Earth Research Institute, said the proportion of China's rare earth reserves to the world's total has declined sharply because of the exploitation, damage and waste of rare earth resources in China and consistent overseas breakthroughs in rare earth explorations. Chinese rare earth suppliers have under-priced their products and engaged in fierce competition, leading to a steep falloff in rare earth product prices.

"Despite the fact it owns a small percentage of rare earth reserves, China supplies the majority of the global demand, which is obviously unsustainable in the long run and unfair as well. In the long run, lifting rare earth prices and increasing rare earth supplies from countries other than China will be an inevitable trend," said Zhang Anwen, deputy secretary general of the Chinese CSRE, during the forum.

In fact, many countries have rare earth resources. Since the 1980s, China's low-price rare earth supply has started to pour into the world market. This has led countries such as the United States and Canada to close down their own rare earth mines.

In the existing global rare earth industry pattern, Chinese enterprises are still just low-price rare earth product suppliers and enterprises in Europe and the United States produce high-precision and high-tech products using materials that are separated from rare earth raw materials imported from China. They then sell the products back to China, achieving an exponential increase in added value.

"China has long supplied the world low-price, high-quality rare earth resources, in which we have not only paid a heavy environmental cost, but our enterprises lag behind those in other countries in terms of application technologies as they lack the funds to enhance their technologies," said an expert from the China Minmetals (Beijing) Research Institute while reviewing China's past tactics relating to rare earth resources.

An Sihu, assistant director of the management committee of the Baotou National Rare Earth Hi-Tech Industrial Development Zone, said there are a lot of misconceptions about China's rare earth industry.

"China is rich in rare earth resources and known as the world's largest rare earth producer and consumer but is not a powerful country in terms of rare earth production technologies," An said.

China's rare earth industry lacks a highly-profitable rare earth application procedure and needs to import advanced application technologies, he said.

"Low added-value primary products cannot bring in much profit, so we lack the financial capacity to compensate for the environmental losses," An said.

By People's Daily Online