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Japan to reduce rare earth consumption in response to China's export controls
Japan took another step toward lessening its rare earths dependence today, announcing plans to drastically reduce consumption levels in response to China's continued market dominance. Of particular concern to the Japanese government is dysprosium -- a rare earth used in the production of high-powered magnets. China, which accounts for about 95 percent of the world's rare earth supply, has been tightening export controls on the metal in recent months, sending global prices skyward. With its domestic supplies dwindling, Japan has now committed to reducing its dysprosium consumption by 30 percent over the next few years, as part of a $65 million initiative. Much of that money will presumably go toward helping manufacturers develop alternative production and recycling methods, as some already have. Toyota, for instance, has found a way to produce hybrid and electric vehicles without using dysprosium, while Mitsubishi, Panasonic and TDK are currently looking at ways to extract the metal from old air conditioners. If effective, the government's program would reduce domestic consumption by between 200 and 400 tonnes per year.
WTO says China's rare earths export controls violate international rules, US applauds
China's monopolistic approach to the rare earths market is in violation of international trade regulations, according to a new ruling from the WTO. The verdict, issued yesterday, covers exports of nine minerals -- including zinc, manganese and magnesium -- that are used to produce a wide variety of smartphones, tablets and other gadgets. China, which controls about 95-percent of the world's rare earth supply, had previously argued that its export restrictions were needed to prevent overproduction and to conserve natural resources, but the WTO determined that the country was "unable to demonstrate" these environmental benefits. The investigation was originally spurred 18 months ago, after the US and other countries complained that China's quotas and tariffs unfairly favored domestic manufacturers, while distorting global prices. Experts expect Beijing to appeal the ruling, but this extra international pressure, combined with shifting supply chains and newfound deposits, may bring about the changes many have been calling for. If it doesn't, we'll all be stuck with corn phones.
