China almost doubles rare earth export quota

China on Thursday nearly doubled the export quota of rare earths for the second half of the year to 15,738 tonnes, amid tensions with trade partners over its grip on the shipments of raw materials. The quota for the next six months of the year is up 97.3 percent from the 7,976 tonnes set for the same period last year, according to data from the Ministry of Commerce. It was unclear whether the quota covered iron alloys containing rare earths -- a rule Beijing announced in May as part of efforts to further tighten control over the increasingly lucrative metals. China produces more than 95 percent of the world's rare earths -- 17 elements critical to manufacturing everything from iPods to low-emission cars and missiles. Beijing, keen to burnish its green credentials and tighten its grip over the highly sought-after metals, has started cleaning up the industry by closing illegal mines, restricting overseas shipments and hiking export taxes. In December, it slashed the export quota of the metals for the first half of the year to around 14,450 tonnes, down 35 percent from the same period in 2010, after cutting the maximum by 72 percent for the second half of 2009. The moves have led to a spike in international prices of the elements and triggered mounting complaints from foreign buyers. EU trade commissioner Karel De Gucht last week urged Beijing to "ensure free and fair access to rare earth supplies" when the World Trade Organisation ruled against China's export restrictions on some other raw materials than the metals. The WTO upheld complaints by the United States, the European Union and Mexico that Beijing had restricted exports of industrial raw materials such as bauxite, coke, fluorspar, magnesium and manganese to help its own industries against foreign competitors. The United States and Australia have responded to the rare earth restrictions by developing or reopening mines shuttered when cheaper Chinese supplies became available.