China safeguards rare earth reserves with discovery of 5 million tonnes of key metals
China discovers 4.96 million tonnes of rare earth elements, which are crucial to tech development, in one of its poorest regions
China is set to further safeguard its reserves of rare earth elements by about 5 million tonnes amid increasing international competition, especially with the United States, following a discovery in the southwestern Sichuan province.
Rare earth specialists told a symposium held last week by China Rare Earth Group that 4.96 million tonnes of rare earths – which are crucial to tech development, ranging from electric vehicles to wind turbines, robots and military weapons – had been found in the Liangshan Yi autonomous prefecture, which is one of the poorest regions in China.
China is the world’s top producer of rare earth elements, that includes 17 metal oxides, with 44 million tonnes of deposits, according to the US Geological Survey.
“In the face of the new situation of international competition … the group will keep the nation’s greater interests in mind, to make new, significant contributions to safeguarding China’s rare earth resource security,” the state-owned China Rare Earth Group said in a statement on its official website on Saturday.
China’s rare earths dominance has increasingly raised geopolitical concerns amid the escalating tech rivalry between China and the US.
China’s rare earth industry must also expand into downstream sectors, improve resource utilisation efficiency, and enhance the technological edge of enterprises
Pan Helin, an economist and adviser to the Ministry of Industry and Information Technology, told the state-owned China Securities Journal on Saturday that the discovery in Sichuan would enhance China’s resource advantage in the global rare earth market.
“While consolidating resource advantages is crucial, China’s rare earth industry must also expand into downstream sectors, improve resource utilisation efficiency, and enhance the technological edge of enterprises,” Pan said.
China accounted for between 80 and 90 per cent of global rare earth production in the early 2010s, but that dominance waned to around 70 per cent by 2023 amid a global increase in the supply of rare earths, according to the US Geological Survey.
The China Rare Earth Group was formed in 2021 following a merger of units under three state firms, seen by industry analysts as marking a significant step toward bolstering China’s rare earth production dominance.
“[The group] will enhance its core function in safeguarding the security of rare earth resources … focusing on six key objectives [in rare earth] – expanding resources, increasing reserves, boosting production, stabilising supply, reducing costs and ensuring security,” the company statement added.
Last month, the Ministry of Industry and Information Technology and the Ministry of Natural Resources jointly set the upper limit for the year’s second batch of rare earth mining output at 135,000 tonnes and smelting at 127,000 tonnes.
Combined with the first batch, the two batches this year stand at 270,000 tonnes and 254,000 tonnes, respectively, representing a year-on-year increase of 5.9 per cent and 4.2 per cent, respectively, from the first two batches of quotas released last year.
China’s rare earth exports in the first eight months of the year rose by 6.4 per cent year on year to 38,755 tonnes, while the export value plunged by 40.2 per cent to US$341.2 million , customs data showed.