Sept. 3 (Bloomberg) -- China said supplies of dysprosium and terbium, minerals needed to make hybrid cars and televisions, may be inadequate for its own needs, adding to concerns that the largest producer of rare earths may further cut exports.

China, accounting for more than 90 percent of global rare- earth output, “may not have enough supply” of the two minerals as demand increases, Wang Caifeng, deputy director-general of the raw materials department at the Ministry of Industry and Information Technology, said today.

Surging production of hybrid cars and music players such as Toyota Motor Corp.’s Prius and Apple Inc.’s iPod have driven up demand for rare earths. China has cut export quotas to shore up prices and ensure domestic supplies, though there will be no ban on exports of the elements, Wang said today.

“The rest of the world has become a little concerned” about possible export bans from China, said Judith Chegwidden, managing director at London-based Roskill Information Services Ltd, an industry research group. “Dysprosium is increasingly used in permanent magnet motors in hybrid cars like Prius or wind turbines. Demand is growing fast.”

China has about half of the world’s reserves of rare earths, a range of more than 15 elements such as scandium and lanthanum. The government started to curb output and exports in 2006 as prices dropped, and Zhao Shuanglian, deputy chief of China’s Inner Mongolia province yesterday said the country may stockpile elements in a strategic reserve.

That could force companies to broaden their search for other suppliers.

Toyota Alternatives

“We’re always exploring alternative procurement sources,” said Paul Nolasco, a spokesman for Toyota, declining to comment specifically on China’s policy. Neodymium, a type of rare earth, is used to make the electric motor of its Prius car, he said.

Chinese exports of rare earths fell 35 percent to 34,600 metric tons in 2008 from 53,300 tons in 2006, according to Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Co., which owns the largest rare-earths mine. The company was yesterday tasked to take over smaller rivals in Inner Mongolia to strengthen control over supplies.

“Demand is growing in areas of military defense, missiles, electronic information and green energy,” Wang said at a conference in Beijing. “Modern society can’t do without cell phones and televisions.”

China needs 70,000 tons of rare earths a year, she said. China cut 2009 output quotas of rare earths by 8.1 percent from a year ago to 119,500 tons, the Ministry of Industry of Information and Technology said May 18.

Waste

Terbium is a silvery-white metal used to make alloys and phosphors used in lamps and TV tubes. Other rare earths include neodymium, which is also used in mini hard drives in laptops and headphones in Apple’s iPod. Yttrium and europium are used to generate red on color TV and computer monitor screens.

China is also tightening control of mining for rare earths because it can lead to “serious pollution,” Wang said. To mine a ton of the material could lead to 2,000 tons of dirt and waste, she said.

The Asian country is also encouraging producers of minor metals to export processed products rather than raw materials to increase the value of shipments, said Liang Shuhe, deputy head of foreign trade at the Ministry of Commerce.

Minor metals include antimony, magnesium, zirconium, mercury and bismuth, according to the Minor Metals Trade Association. China’s Jinduicheng Molybdenum Co. is Asia’s largest producer of molybdenum, used to harden steel.

“The majority of China’s minor metals exports remain in the raw material form,” Liang said at the conference. “We encourage exports of high value-adding, high-end products instead of the raw materials.”

0 comments:

Post a Comment