The Controversy over Chinese Monopoly of Rare Earth Minerals has become highlighted in recent days over its unofficial embargo over exports to Japan.The European Union and USA were already concerned over Chinese control of 95% of the global rare earth production.While newer sources are being hectically being searched for and stocks of some rare earth miners have shown an exponential rise,non-Chinese production will take a while in happening.Recent reports already indicate a critical shortage with some optics makers being forced to close over rare earth shortages.Price increase are also being planned by end product companies as oxides of some rare earth minerals like cerium and samarium have increased by 5-7 times in the last 3 months.
Following export restrictions imposed on rare-earth minerals by China in the summer, the soaring price of cerium oxide – a key material used as a polishing slurry for high-precision optics – is causing havoc in the optics supply chain.
According to industry sources, one company has already been forced to shut down as it awaits supplies of the material, while others may introduce a cerium surcharge if the situation does not change. Suppliers of cerium-based products are unable to guarantee prices beyond more than a few days.Robert Castellano, an industry analyst at The Information Network, told optics.org: “The market price of cerium oxide has increased to approximately $50 per kilogram in September 2010 from $15 per kg in April 2010 and $9 per kg in September 2009.”That sudden price-hike has since been reflected directly in product costs. Jim Sydor at custom, high-precision optics provider Sydor Optics has seen the price of Unicer 166, a high-purity cerium powder, increase from $26.74 to $42.50 per pound – meaning that a typical bill for the material has increased by some $16,000 in a matter of days. The global hike in prices has also affected key Japanese ceria slurry suppliers Showa Denko and Hitachi Chemical.
WTO Defers Chinese Case to 2011
European Union,Mexico and USA had filed a case with WTO in 2009 over the Chinese monopoly and trade resticitions of rare earth minerals.However WTO has failed to resolve the issue despite a time limit of 6 months.The WTO Panel has defered the WTO case to April 2011 without assigning a reason.WTO is more of a negotiatino forum rather than a body which can punish violators .To expect WTO to make China increase it export quota of rare earth minerals is like living in a fool’s paradise.Trade Tensions between China and other world trade powers is already very high.Currency and Global Imbalances are already major issues which threaten to derail the world economic recovery (however faint it maybe).Rare Earth Minerals are proving to be another big thorn in trade relations between China and the West.
The World Trade Organization will not publish a ruling in a dispute brought against China over exports of rare earths – vital for hi-tech goods from car parts to electronics – until next April instead of this year, a WTO document showed on Friday.
A statement by the chairman of the panel examining the case, published on the WTO website, said the panel expected to complete its work by April 2011.
Under WTO rules, a panel should normally publish its ruling on a dispute within six months of being formed. The WTO agreed to set up the panel in December 2009, and its membership was agreed at the end of March this year.
The panel gave no reason for the delay but said it had been agreed with the parties to the dispute.