China Creates Rare Earth Superpower with Three Company Merger
- December 27, 2021
- Posted by: Quatro Strategies
- Category: Mining
China Minmetals Rare Earth Co said it will merge with two other Chinese rare earth producers under the state assets regulator, creating a “super company” in the strategic industry. China is already dominant in global rare earth production, and efforts to consolidate the nation’s rare earth companies have been considered as a way to increase influence over pricing.
China’s 85-90% control over the sector means a problematic reliance for the West on Chinese supply, especially at a time when relations are tense.
Minmetals Rare Earth has signaled such a restructuring in September. The company said the merger was approved by the State-owned Assets Supervision and Administration Commission.
The merger will see Minmetals Rare Earth, Chinalco Rare Earth & Metals Co and China Southern Rare Earth Group Co transfer into a new company, which was not named.
The new company will be second only to China Northern Rare Earth Group in terms of output. It will account for around 70% of China’s heavy rare earths production. This will mean that pricing of some key rare earths, such as dysprosium and terbium, will be in the hands of one company.
Get your daily Business Brief
Business Brief delivers the latest insights straight to your inbox
You'll get daily industry insights on
Energy, Cleantech, Oil & Gas, Mining, Defense, Aviation, Construction, Transportation, Online Retail, Bigtech, Finance and Politics of Business