China won't block rare earth metals trade: Premier

Premier Wen Jiabao Wednesday responded to allegations the nation is blocking the exports of rare earth metals to Japan saying, "China has not and will not obstruct the trade of rare earths."

China will ensure a sustainable supply of the resources, while still controlling the output, Wen said at the sixth China-EU Business Summit Wednesday in Brussels. China will not use rare earths as a bargaining tool, Wen said.

One day prior to Wen's speech, Japan's Trade Minister Akihiro Ohata said he plans to call on China to boost its rare earth exports, as a ministry survey showed 31 firms had problems receiving the rare metal shipments from China.

"The results of the survey are at odds with what the Chinese government told Japan formally, so we would like to ask China to resolve the issue as soon as possible," Ohata said. The survey again raised concerns over China's near monopoly of rare earths, a collection of 17 metallic elements, which are used in defense technology, computer hard drives, hybrid cars and other applications.

Recent media reports said China halted rare earths exports to Japan after a Chinese trawler captain was arrested by Japan near Diaoyu Islands.

US Commerce Secretary Gary Locke Wednesday also called for China and Japan to ensure a free flow of the resources. China accounts for some 90 percent of the world's total rare earths exports, more than the half of which are to Japan, according to Zhang Xiaoxin, general manager of the rare metals and minerals department of Asian Metal, a business intelligence service provider for industry traders.

Industry watchers also said a complete embargo is not likely. China has been cutting its rare earth export quota since 2007, Zhang said.

Source: Global Times