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China Drafting Rare Earth Rules on Mining, Association Says

China, the world’s largest producer of rare earths, is drafting rules to crack down on illegal mining, reduce pollution and prevent price wars, an industry association said today.

They are at the proposal stage and a long way from becoming laws, said Chen Zhanheng, a spokesman at the Association of China Rare Earth Industry in Beijing. The group has extensive contacts with various ministries and is in charge of drafting rules on the issue, although it isn’t affiliated with the government, he said.

China cut mining permits and imposed production and export quotas in 2007 to cut pollution and conserve supplies of rare earths, a group of 17 chemically similar elements used in everything from hybrid cars to smartphones. Export controls soured relations with the biggest users including the U.S. and Japan.

The Shanghai Securities News reported today that China may stockpile rare earths this year after purchasing for inventories in 2012 and 2011.

Two calls to the National Development and Reform Commission, which oversees stockpiling of materials from copper to rare earth, weren’t immediately answered.

China set its production quota for 2013 at 93,800 tons, unchanged from 2011, according to the Ministry of Land and Resources.

To contact Bloomberg News staff for this story: Feiwen Rong in Beijing at frong2@bloomberg.net

To contact the editor responsible for this story: Brett Miller at bmiller30@bloomberg.net

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