Woulfe Mining Corp WFEMF

Put the squeeze on tungsten

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https://www.steelguru.com/metals_news/China_cuts_rare_earths_mine_permits_41pct_to_boost_control/283792.html

Bloomberg reported that China reduced the number of permits to mine rare earths by 41% tightening production of the metallic elements used in batteries and magnets.

The Ministry of Land and Resources said that China issued 67 mining licenses for rare earths and 10 exploration permits. The nation previously had 113 mining licenses.

Inner Mongolia Baotou Steel Rare Earth Hi-Tech Company, China’s biggest producer led gains today by producers in Shanghai trading. Chinese output accounts for more than 90% of the global supply of rare earths such as neodymium used in magnets and lanthanum which refiners use to help separate crude oil into gasoline and other products.

Mr Jonathan Hykawy a Toronto based analyst at Byron Capital Markets Limited said that “The goal appears to be to gain greater control over the production of rare earths by putting that production largely into the hands of companies that are large enough to not have any real incentive to cheat on their production or export quotas.”

Inner Mongolia Baotou Steel gained 2.2% to close at CNY 35.49 in Shanghai. Rising Nonferrous Metals Share Company gained 2.1% to CNY 51.37 and China Nonferrous Metal Industry’s Foreign Engineering and Construction Company was up 1.7% to CNY 21.81 in Shenzhen. The benchmark Shanghai Composite Index advanced 0.6%.

Ms Cai Hongyu a Hong Kong based analyst with China International Capital Corporation said that China’s eastern province of Jiangxi which focuses on the production of so called mid to heavy rare earths had the most number of mining licenses withdrawn. The cut would benefit rivals including Xiamen Tungsten Company and Rising Nonferrous.

Byron Capital’s Hykawy said that rare earth prices surged in 2011 after the Chinese government said it would restrict exports. Since then prices have dropped as users work through stockpiles. Neodymium oxide produced in Inner Mongolia has dropped 63% in the past 12 months to CNY 425,000 per tonne. Lanthanum oxide fell 55% to CNY 62,500.