China News Summary
China to build up commodity reserves
China announced it is building up strategic reserves of copper, chromium, manganese, tungsten, rare earth metals, as well as oil and certain types of coal. The announcement came as oil prices slipped further down.
Inner Mongolia Baotou Steel Rare Earths (600111, SH), China's largest rare earths processor, dropped 0.96 percent to RMB 8.22.
Xiamen Tungsten Co. (600549, SH), world's largest tungsten refiner, dropped 2.64 percent to RMB 8.12.
Yunnan Tin Co. (000960, SZ), world's largest tin producer, declined 4.02 percent to 10.74.
Pingdingshan Tianan Coal Mining Co. (601666 SH), the listed unit of China's fifth-largest producer of the coal, added 0.26 yuan, or 1.8 percent, to 15.11.
Hebei Jinniu Energy Resources Co. (000937,SZ), a Chinese coal producer, rose 0.56 yuan, or 3.3 percent, to 17.56.
According to the Ministry of Land and Resources, China will by 2020 consume 3.5 billion tons of coal, 500 million tons of crude oil and 1.3 billion tons of iron ore. And it's reliance on import of crude oil, iron ore and copper will be 60 percent, 40 percent and 70 percent respectively if preventive measures are not taken.
Rare earths getting rarer
By 2015, the country will keep its annual output of the rare earths below 140 thousand tons, with the annual output of tungsten, tin, antimony below 78 thousand tons 150 thousand tons and 140 thousand tons respectively. The country will also strengthen protection on indium, germanium, zirconium and vanadium.
China has the world's largest deposits of rare earths (as well as tungsten, indium and germanium) and produces over 90 percent of the world's strategic metals. Activists will be pleased production and prices have gone down as the relatively high price of high earths had previously wreaked havoc on many rural Chinese villages by spewing toxic waste into the general water supply. ,
China reduced its export subsidy on some rare earths in 2005 after the country extracted 76 percent of its measured rare earths deposits and squeezed the export price 36 percent lower than that of 1990.
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