European Union disappointed at Beijing’s new quota on rare earth material

Article by Christian A., on July 15, 2011

The European Union was disappointed at the new quota of Beijing for rare earth material, which is essential to producing batteries for hybrids and electric vehicles. According to EU trade spokesperson John Clancy, the quota did not change the annual amounts allowed for export to Europe.

The quota was announced on Thursday. Clancy further disclosed that China had added ferro-alloys to the quota, which in practicality, results in a tightening of the limits.

Moreover, Clancy stated that EU continues to encourage the authorities in China to review their export restrictions policy to make sure that there is full, predictable, fair and non-discriminatory access to rare earth supplies and other raw materials for EU industries.

China announced a batch of quotas on Thursday for exports of rare earths for 2011 during a visit of EU's trade negotiator to Beijing and just a week after the World Trade Organization ruled against its limits on a different combination of raw materials.

The ruling of WTO that China had breached trade law by limiting foreign sales of eight raw materials led the United States and Europe to say that meant Beijing should also be forced to increase exports of 17 rare earths.

China accounts for about 97 percent of international output of rare earth minerals vital to worldwide electronics, defense and renewable energy industries. The country’s export quotas have choked off international supplies, bolstered prices and angered the trading partners of China.

Peter Tyroller, the board member in charge of sales and marketing at Robert Bosch GmbH, informed Automotive News Europe Congress last month that he is concerned about the price of rare earth materials.

Topics: europe

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