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China Announces Second Batch of Rare Earth Export Quotas for 2011
July 27, 2011


On July 14, 2011, China’s Ministry of Commerce announced that the export quota for rare earth exports for the second half of 2011 will be 15,738 metric tons, shared amongst twenty-six rare earth producers. Although this quota is nearly double the 7,976 tons second batch rare earth quota from last year, the full year 2010 and 2011 quotas are nearly identical. China allowed 30,258 tons of rare earth exports in 2010, while the annual 2011 quota stands at 30,184 tons. According to Nkenge Harmon, the Deputy Assistant U.S. Trade Representative for Public and Media Affairs, the 2011 and 2010 quotas are approximately forty percent lower than China’s 2009 quotas. Additionally, due to China’s expansion of the scope of products covered by the quota last May, this batch of quotas covers more products than in past years.

Trade Officials in both the United States and the European Union have voiced disappointment regarding the new quota levels. On July 5, 2011, a WTO Panel ruled that certain Chinese export restraints on raw materials critical for industrial usage violated China’s WTO commitments. Should this decision be upheld when China submits its expected appeal of the ruling, it would provide a strong basis for the U.S., the EU, and Japan to challenge China’s restrictions on rare earth exports.

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