Media Report: China’s Raw Materials Giant Takes Shape

by | 6. Dec 2021 - 13:29 | Market

The Chinese rare earth industry is to be consolidated. Several media report that the China Rare Earth Group could be founded as early as December.

China wants to strengthen its market power by consolidating the industry around the extraction of rare earths, it was said at the end of September. As the Wall Street Journal (WSJ) reports, the plan is now taking shape. As early as this month, the merger of several state-owned companies could create the China Rare Earth Group, the newspaper writes, citing well-informed circles.

By merging, the government hopes to gain greater influence over the pricing of critical commodities, it said. In addition, internal power struggles between Chinese companies should be avoided, thus improving its position vis-à-vis Western countries, the WSJ adds.

In March of this year, Xiao Yaqing, minister of industry and information technology, had blamed internal Chinese competition for what he saw as too low prices.

Analysts expect the consolidation to raise price levels, presumably also because the new company will set stricter rules for production volume and export volume, the Chinese newspaper Global Times said, citing industry experts.

Photo: Xinhua

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