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China to create rare earth mega-corporation

Updated: 2012-08-09 21:04
( Xinhua)

BAOTOU, Inner Mongolia - A proposal to form a massive rare earth corporation has been submitted to the State Council, China's Cabinet, and is highly likely to be approved soon, a leading domestic producer said Thursday.

The establishment of China North Rare Earths (Group) Hi-tech Co will be led by China's top rare earth producer, the Inner Mongolia Baotou Steel Rare-Earth (Group) Hi-Tech Co. (REHT), whose light rare earth output accounts for more than half of the world's total, REHT's general manager Zhang Zhong said at a major annual industry conference.

He said that to form the mega-corporation, the REHT will team up with major rare earth producers in Gansu, Sichuan and Shandong provinces to integrate light rare earth resources in the country's northern region.

The proposed group will also actively participate in the restructuring of rare earth enterprises in the southern provinces, which are known for their heavy rare earth production, Zhang said.

Share prices of the REHT edged up 0.29 percent to 41.51 yuan ($6.55) Thursday on the Shanghai bourse.

China plans to foster two or three large rare earth enterprises by consolidating companies in the sector, Minister of Industry and Information Technology Miao Wei said in March.

The industry consolidation and the country's other measures, including output caps, export quotas, stricter emission standards and higher resource taxes, all aim to control environmental damage, stave off resource depletion and promote the sustainable development of the sector.

As the world's largest producer of rare earth metals, China now supplies more than 90 percent of the global demand for the metals, although its reserves account for just 23 percent of the world's total.

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