October 22nd, 2010
06:49 AM GMT
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(CNN) – China can publicly deny that it has halted exports of rare earth. But Shigeo Nakamura knows what he is seeing: no rare earth has come into his company from his Chinese suppliers.

“Nothing, nothing at this moment. Nothing,” said Nakamura, president of Advanced Material Japan Corporation, a Tokyo-based rare earth and metal trading house.

Nakamura said his company has a year’s supply stockpiled, but he is worried.

“This,” he said, pointing to a tiny, two millimeter cylinder, “is a micro-motor from a mobile phone. If China stops supply of the raw material, you will not use the mobile phone. You will not see the TV. And you will not see any refrigerator.”

Rare earths are minerals used in small amounts on virtually every electronic item for sale around the world.

China has 30 percent of the world’s reserve of rare earths, but mines it cheaply and effectively. More than 90 percent of the world’s available supply is currently mined in China.

That control became clear last month to Japanese rare earth importers, exporters and the government.

In the wake of a collision at sea between a Chinese fishing vessel and the Japan coast guard in September, multiple Japanese rare earth importers tell CNN that China dramatically slowed exports of rare earth.

China denies it stopped exports in retaliation.

But Beijing has been curbing international exports for the last few years amid concerns about supply and growing demand.

Whatever the reason behind the slowdown in rare earth exports, Mizuho Research Institute senior economist Jun Inoue says it highlights what Japanese economists call “China risk.”

That risk involves the world relying too heavily on China, a country whose communist government can rapidly affect the global economy.

“The world is heavily relying on China not only in finance and trade, but also natural resources,” said Inoue. “In the market economy, each economic entity makes decisions by individual will. But under the controlled market economy (like China), the government has plans and targets. There is a risk that such national plans and targets influence the world economy.”

China on Wednesday denied that it has halted export of rare earth materials amid news reports that Beijing started blocking shipments of the crucial minerals to the United States and Europe following similar measures against Japan.

"China will continue to provide rare earth to the rest of the world," the ministry of commerce said in a statement faxed to CNN. "At the same time, to protect exhaustible resources and achieve sustainable development, China will also continue to implement restrictive measures on the mining, production and export of rare earth."

Nakamura said his company has a year of rare earth stockpile. He remains optimistic that Beijing will loosen exports, saying China stands to lose too much money if developed economies like Japan and the U.S. mine for rare earth elsewhere.

“Maybe two weeks” before Chinese exports resume, said Nakamura. “Two weeks, I hope.”

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soundoff (52 Responses)
  1. Hien

    No matter what China said and excuses. China acted like a tantrum child, with childish behaviors.

    October 22, 2010 at 3:07 pm |
  2. AJ

    Time to find another supplier! Looks like alot of people will be heading to Canada, Australia, Brazil, Vietnam, or South Africa. I cannot believe that the US would actually allow its lead in rare earth mining to fade away!!

    October 23, 2010 at 1:26 am |
  3. Andi

    Rare earth metals are a strategic asset and should be used to the advantage of China. Why should China suffer extreme pollution from mining these minerals only to benefit foreign nations ? These minerals are widely available throughout the world but Not mined due to the accompanying pollution. 35% of factories in China are owned directly by foreign companies, together with the pollution that comes with it.
    China is providing cheap manufactured goods to the world along with a destruction of the environment in producing these goods.

    This can't go on forever.

    October 23, 2010 at 2:03 am |
  4. Mark

    Time to stop buying Chinese trinkets. No, none of us will
    be able to go completely cold turkey, but start somewhere.
    We've got to do this, or we're going to be digging trenches for the Chinese. They are people that think it's ok to skin animals alive.
    They cook and eat living fish. They eat dogs beating them to death because they think it makes them taste better. If you think African Americans suffered as slaves in this country wait until you are
    the slave of the Chinese. We need to act now.
    If you enjoy your way of life in America, you need to stop buying their stuff.
    Do you have children? Grandchildren? Do it for them.

    October 23, 2010 at 2:58 am |
  5. too bad!

    China is just learning from the heavy handedness and hypocrisy of the west and Japan. Time to have a taste of your own medicine.

    October 23, 2010 at 3:47 am |
  6. Jimmy the Big Fat Greek

    China's making A LOT of enemies right now. It's like the big bully in the classroom ostracizing himself. Doesn't matter how big you think you are we'll get even.

    October 23, 2010 at 4:23 am |
  7. Bush

    China can sell whatever she wants to sell. China can stop selling whatever she wants to stop selling. She does NOT break any UN resolution. She does NOT violate any "world trade regulations" (if any). Let alone invading other country without pretext or UN blessing. Nuff said.

    October 23, 2010 at 4:31 am |
  8. Greg Wiens

    Is anybody surprised by this?

    October 23, 2010 at 5:17 am |
  9. alien

    Hien,i think you are more likely a tantrum without brain and don't know how to ponder an issue..and most childish is when Japan foreign minister- used a word "hysteric"..it is too hard to figure out what an un professional foreign minister is....

    October 23, 2010 at 5:34 am |
  10. nk

    isolate them

    October 23, 2010 at 6:25 am |
  11. David

    China shall impose embargo of these materials to any country that is unfriendly to China (aka economic sanctions, an often abused American strategy). Even for the country China is willing to export to, they shall be restricted only to be used for non-weapon products to keep the world in peace. China shall send out inspectors at the recipient site to enforce that (another American strategy). Why it becomes a problem if China exercises this right while it is not a problem for the US to practice this? The US has been a member of WTO.

    October 23, 2010 at 6:26 am |
  12. Peo

    Learn how to make business withing Natures own Eco Cycle and we'll reach sustainable development and avoid these short-sighted twists between countries like China, US, Japan and Europe. Learning how the eco cycle works, is like learning how to ride a bicycle; you'll never forget it once you know it.

    October 23, 2010 at 6:36 am |
  13. ll

    it belongs to China,undoubtedly!!!!

    October 23, 2010 at 7:00 am |
  14. Yang

    So it's ok when the US impose embargo on countries that the US considers to be its enemies. however, when China does it to protect its sovereignty, it's childish. Why is there a double standard?

    October 23, 2010 at 8:53 am |
  15. peter mills

    China wil, with out a doubt resort to controlling the world, just as they do with their own people, the facts speak for themselves

    October 23, 2010 at 10:04 am |
  16. mark

    Doesn't seem very smart to completely stop exporting it. This will just increase the desire to find alternatives. Canada's been making iphones using maple syrup for years, it just hasn't been cheap enough to compete until now.

    October 23, 2010 at 10:12 am |
  17. VedicIndian

    China needs to be put in its place. Holding the whole world to its ransom while trying to capture other countries is finally getting too much!

    October 23, 2010 at 10:27 am |
  18. chinapride

    China can halt export to anything she wants.
    Don't you disrespect our motherland, you cry baby !

    October 23, 2010 at 10:55 am |
  19. Raj

    It may be expensive, world needs to look for alternatives.Otherwise ,in long run ,depending on China ,can be counterproductive.

    October 23, 2010 at 11:01 am |
  20. Sakamoto

    I agree with Hien. That's why China should not stop it's exports of Rare Earth only of it's cheap products. In return US will sell arms to North Korea and Iran. Russia will supply gas to Ukraine even if they do not get paid. Because we are one world. And Hien is on pot!

    October 23, 2010 at 11:09 am |
  21. Abdul

    The people from the other countries are smart enough to learn lesson early on and never again rely on China alone therefore should find an immediate alternative resource from the other countries.

    October 24, 2010 at 10:32 am |
  22. peter

    this is totally acceptable just research nanjing massacre and you will understand why this is happening. japan will eventually taste full revenge.

    October 24, 2010 at 11:10 am |
  23. 3rd party

    You can
    1) find another supplier (condemning China), and
    2) be not-over-consumed (considering the poor and our future).

    I'll recommand you 2).

    October 24, 2010 at 1:35 pm |
  24. Bakatare

    Yeah, China should stop exporting, I'm all for that, but don't come begging later.

    October 24, 2010 at 10:14 pm |
  25. nurupo

    China should resume the exporting rare metals to the world.
    if they would't it, I think china will be end up losing face in the world.

    Chinese vessle bumpd Japanese ships on purpose.
    Japanese goverment has the evidence video that was taken in near the senkaku ilands. if they watch this video and understand which country is wrong.

    October 24, 2010 at 11:28 pm |
  26. Indian Tiger

    India is 5th largest producer of rare earth elements, Indiam PM is heading towards Japan to offer help. I believe India and only india has potential to tame china. I believe china also knows this, that;s why they are doing everything possible to corner india either by supporting Pak on Kashmir issue or blocking loans from IMF.

    October 25, 2010 at 4:05 am |
  27. choe_mu_seon

    Typical CCP strategy: deny any wrongdoing while using underhanded tactics to achieve the same goal. Yeah, we're not exporting any rare earths, but its not an embargo because we didn't make an official announcement about it. Let's point at someone elses problems to justify our own immoral acts.

    October 25, 2010 at 7:22 am |
  28. Paddy Lawrence

    too bad! October 23rd, 2010 3:47 am ET

    "China is just learning from the heavy handedness and hypocrisy of the west and Japan. Time to have a taste of your own medicine".

    Yeah, it's exactly that attitude that reminds us how backward you people really are. You seem pleased that China's new way is to treat other nations shoddily and clumsily..!

    So this means we should treat China and its people in exactly the same way. Wherever they are in the world – whichever university they're studying, or whichever restaurant or dry cleaners they work in, we should treat them with little respect or honour because the nation they come from is nothing more than this planets current GLOBAL BULLY and just wants revenge on everyone.

    You have forgotten that China has a lot more of its people out in the big wide world than the world has in China. If you want them treated properly and given the proper rights and privileges of citizens then you're going to have to stop spouting such utter shite.

    Trust me, if you and other yellows insist on pumping out this crap, it won't be long before the entire planet is yearning for China's collapse. And don't say it won't happen because it will. It happened for the Greeks, Romans and Mayans way back and it happened to the British and its happening to America right now.

    China WILL be next – and to mirror your attitude – I WILL be glad to see it.

    DOWN WITH CHINA!!!!!!!!!!!!!!!!!!

    Paddy Lawrence
    Dublin

    October 25, 2010 at 10:11 am |
  29. Paddy Lawrence

    Yang October 23rd, 2010 8:53 am ET

    "So it's ok when the US impose embargo on countries that the US considers to be its enemies. however, when China does it to protect its sovereignty, it's childish. Why is there a double standard?"

    Yang, there isn't a double standard. China and the US are BOTH wrong. You seem to forget there are another 240 countries on earth that DON'T play stupid games like China and the US. Pull you head out from your a*s and you might notice.

    October 25, 2010 at 10:14 am |
  30. Paddy Lawrence

    chinapride October 23rd, 2010 10:55 am ET

    "China can halt export to anything she wants.
    Don't you disrespect our motherland, you cry baby !"

    I've only got one thing to say to you....PRIDE COMES BEFORE A FALL

    and oh how China will fall.

    October 25, 2010 at 10:16 am |
  31. Dozo

    Japan has hoarded enough rare earth for many decades, they don't really have to do anything or complain about China stopping rare earth exports.

    October 25, 2010 at 11:17 am |
  32. ElCordobes

    China is now a world power. China can do whatever it wants with its natural resources. The United States instead has become a declining nation. Chinese kids study and study and China graduates thousands of scientists and engineers each year. You ever been inside a public school classroom in the US lately? The worst possible learning environment you can conceive. American kids disrespect their teachers, hate school and could care less about learning. Why the surprise then? The American dream is now only that.

    October 25, 2010 at 11:50 am |
  33. worldneedsjustice

    Lol, for long time some Americans complain industries have been outsourced to China, and China has been competing unfairly with cheaper labor and low environmental standards. Now China tries to tight up all of these standards, and what these American do: pointing fingers on China again. The U.S. has rare earth reserve, why don’t you mine your own reserve. China’s supply only has 15 to 20 years to last.

    Chinese want to be friendly with Americans. Ask any American who had visited China will tell how friendly the Chinese ppl are. But if you the U.S. media always tirelessly trying to make China into an enemy, you will get one, because even arduous pro west Chinese like me feels so fed up with unfair attacks on China.

    And Japan, very much wish to be friendly with them too, just Please, the Japanese government stop doing things that would reminds the pain Chinese had suffered during their invasion. Japanese politicians, please stop honoring war criminals in shrines, and stop illegal occupation of Diayu Island, which was part of RPC (today is Taiwan) before the WWII.

    October 25, 2010 at 3:34 pm |
  34. Sakamoto

    GIVE IT UP CHINA! You know what we can do! We will do what we did in Iraq for oil!

    October 25, 2010 at 7:24 pm |
  35. ObamaBush

    When America learns to live without Walmart (and living wth only 1 television instead of 9), the Great Wall will come crashing down along with the communists.

    The "China has arrived BS" spouted by the Democrats and Commies is really sounding like a broken record.

    China can be replaced. American consumerism built China, and it can just as easily destroy it (no nuclear weapons required). That's what happens when you enslave your entire country to spoiled Western kids.

    October 25, 2010 at 7:59 pm |
  36. triarii3

    "So it's ok when the US impose embargo on countries that the US considers to be its enemies. however, when China does it to protect its sovereignty, it's childish. Why is there a double standard?"

    everything i wanted to say.

    October 25, 2010 at 11:41 pm |
  37. h191

    What is Japan complaining about? They have 50 years of rare earth materials stored. At the current mining rate China will exhaust its deposit in about 15 to 20 years. 30 percent of the worlds deposit sold to the whole world in exchange of pollution and dirt cheap prices. yes rare earth materials are being sold at dirt prices. The export rate of REE's also multiplied by 10 times in the past 10 years. The biggest benefactor from cheap materials, Japan should not complain. If China exhaust its supplies then it would need to buy those materials which will be catastrophic. I don't think its retaliation but more of a strategic factor. The economy should shift from relying on heavy exports anyways.

    October 26, 2010 at 1:21 am |
  38. worldneedsjustice

    Animosity and hypocrisy displayed on here to Chinese is frightening. Only remind us what imperialism west and Japan had done to us. Chinese around the world should united for a stronger China.

    October 26, 2010 at 5:26 am |
  39. worldneedsjustice

    To Paddy Lawrence,

    Your racism is horrific. Frankly I have visited your country Ireland recently. Except Dublin, the rest of Ireland is gloomy and depressing. And to give a little update to your brainwashed narrow mind, the average ppl living in China is far happier than average ppl in Ireland, because ppl in China actually feel hopeful.

    October 26, 2010 at 5:38 am |
  40. worldneedsjustice

    To Paddy Lawrence,

    I hope you will have a chance to visit China, and to experience the hospitality of the ppl overthere, then you will release yourself from so much prejudice and blinded hate.

    Like other well wished Chinese, I hope your nation, Ireland will overcome current economic depression, and the rest world will overcome current difficulty. We, Chinese need to learn better communication with the west, but I hope the west will do the same, don't alwasy waving your fingers, it's conterproductive to world peace.

    About the rare earth, China only have very limited reserve, the 65% reserve are located outside of China, even we have the hightest production. But our environment can't always take this burden to supply this mineral to the rest of world. The rest of world should mine their own reserves, that will create jobs in your countries too, like in India.

    love and peace

    A Chinese

    October 26, 2010 at 5:54 am |
  41. hachimada

    Our resources, we decide. Why are you mad about that?

    We want to reduce production of minerals, does that make us a "bully"? Do we HAVE TO sell your guys our stuff? Don't be ridiculous!

    Look at mirror, look at yourself, you need to understand that FORCING others to sell their resources is BULLY!

    We don't want to let the world down, you just need to dig your own mines, is that so hard?????

    October 28, 2010 at 8:06 pm |
  42. hachimada

    Paddy Lawrence's comments is nothing but racist.

    Last time Ireland was not part of the invading troops around 1900, now you want to join for looting some precious antiques?

    October 28, 2010 at 8:19 pm |
  43. appropriate

    中国的公敌说,日本人民真的吗? 我们丰富你的食物安全,舒适的汽车,破碎设备,如动画和音乐,你是对日本人给我们带来了丰富吗? 你们具有约束力,以人民的利益,谁应该得到该国原来的想法?

    劉先生;慶祝獲諾貝爾獎。 祝賀劉曉波奪得今屆諾貝爾和平獎。服刑的中国作家劉暁波先生 请释放在狱中刘医生。

    October 29, 2010 at 6:25 pm |
  44. Piyaphob

    I don't agree that China should stop exporting this rare earth all at once. Somehow, I understand why China is doing this. Imagine that u are living in a country which has to supply some kind of mineral to the whole world using the process that polutes your own country. Should the same situation happens to you, would you want to keep poluting your countries? Yes, China should keep exporting the rare earth, but one day it has to stop doing this. May be we should find another way or another resource that can be used instead of this material.

    October 30, 2010 at 9:48 am |
  45. yp jame

    japanese factory and manufacture had dominate the world for decades, it seems to me that they are taking for granted that they are the master here and no one else has any right to say anything .
    how longer more the Yankee still want to bully others.

    November 3, 2010 at 2:08 am |
  46. yp jame

    the american had the whole world as hostage with its super 301 for year , the japanese are simple minded who believe that they can take over the place

    November 3, 2010 at 2:17 am |
  47. yp jame

    as long as you are strong like the yankee , you should fear no enemies , but that was a past tense
    a slave master can no longer tolerate a rebellion for mere survival of the slave, i feel sorry for thomas jefferson and the rest of the founding father who had brought dignity to all man kind.

    November 3, 2010 at 2:21 am |
  48. yp jame

    yankee should start learn to respect the world by stopping exploiting the world resource, yankee side kick , the japanese should learn not to exploit the asian neighbors.

    November 3, 2010 at 2:24 am |
  49. Rare Earth Man

    There are plenty of other sources. We do not need the Chinese.

    November 3, 2010 at 2:53 am |
  50. kingping

    Paddy Lawrence is a little crazy! Leave this poor men alone!

    November 6, 2010 at 8:40 am |
  51. icons pack

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    November 4, 2012 at 3:31 pm |
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    See all of the most up to date blog post at our own web-site
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    May 4, 2013 at 8:53 am |

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